Transparency train rolling in health care

What took so long?
Finally, the gnomes in charge of the Medicare claims information announced that they will allow access to its huge database of claims, meaning that insurers, employers and consumer groups will be able to obtain and then slice and dice the performance of local hospitals and doctors.
They will be able to produce reports cards on providers. That is a very big deal as more and more consumers create a marketplace for health care. You can’t have a marketplace without reliable consumer information. Duh!
Transparency has been moving forward quickly of late, after decades of stone-walling by insurers, providers and the government. That is a direct result of the growing dominance of consumer-driven health plans (CDHP).
As of 2011, 32% of employers with more than 500 employees offer high deductible plans offset by personal health accounts, mostly HSAs. It’s a stampede in that direction. In 2010, it was only 23% of large employers. Almost half of the largest employers, those with 10,000 or more employees, have gone to that fundamental reform. Even some governmental units are inching in that direction.
Why? Because CDHP plans save 20% to 30% in comparison to standard plans, where employees have little skin in game. It’s the incentives, stupid!
Wisconsin had already moved, albeit slowly, to more transparency under the Wisconsin Health Information Office. It assembled 250 million claims entries from private insurers. Now the Medicare database will be spliced into its analysis.
Private entrepreneurs are also tapping into the WHIO database to develop companies that peddle user-friendly consumer information on doctor and hospital quality performance.
What a novel idea – consumers looking at value, the combination of price and quality. And guess what?
Cheaper is better. If you are getting your heart fixed, go find the cheapest provider. You’ll find that the cheapest providers also offer the best quality. Check out the web site of the Wisconsin Collaborative on Health Quality if you don’t believe me.
The transparency train is rolling down the track. Once the providers are operating in the sunshine, performance will improve in short order and prices will drop.
It’s refreshing to see that Medicare is helping with a strategy that will do what Obamacare didn’t do – reduce costs and improve value.