A bill under consideration in the Alaska Legislature would increase health care price transparency by requiring providers to print and post online the undiscounted prices of medical services they most commonly perform each year.
House Bill 123, sponsored by state Rep. Ivy Spohnholz (D-Anchorage), would require health care providers to “compile a list, by procedure code, including a brief description, in plain language that an individual with no medical training can understand, of the 25 health care services most commonly performed” by the provider in the state within the past year, the bill states.
The bill would require health care facilities to compile similar lists for their 50 most common procedures. Providers and facilities would have to file their lists with the state’s Department of Health and Social Services (DHSS), post printed versions in conspicuous locations for patients to view, and publish the information online if they have websites, by January 31 of each year. DHSS would also compile and publish the information online.
Providers failing to comply with the bill would face daily $50 fines, up to a $2,500 maximum.
The bill passed the House Health and Social Services Committee and was referred to the House Judiciary Committee on March 10.
Patients as Consumers
Spohnholz says her proposal would increase health care choices for patients and inform their decisions.
“The purpose of the bill is to ensure that consumers and the community as a whole are more aware of the actual costs of health care they are using,” Spohnholz said. “Price transparency can allow consumers to take financial control of their health care and exercise more choice in their providers.”
Lack of price transparency restricts patient choice, holding people hostage to arbitrary prices, Spohnholz says.
“Because of the murkiness around health care prices, consumers have little power to influence the cost of desperately needed medical services,” Spohnholz said. “Medical price transparency across the nation could save the United States $36 billion in health care spending.”
Clear for Competition
Health care specialist procedures in Anchorage cost up to 1,000 percent more as the same ones in Seattle, Washington, Alaska Dispatch News (ADN) reported in September 2016. A $2,042 knee replacement in Seattle could cost $10,218 in Anchorage, or 400 percent more, according to ADN.
Spohnholz says the lack of competition among health care providers and insurers disproportionately drives up Alaska’s health care costs.
“Alaska has the second most expensive health care costs per person in the nation as a result of its small insurance market with limited provider competition,” Spohnholz said. “Health care spending in Alaska increases faster than the rate of inflation, despite the fact that Alaska’s use of health care services is lower than the nationwide average.”
Requiring providers to post their prices would help patients shop for the best values in health care, Spohnholz says.
“My hope is that consumers will be able to use this information to shop around prior to getting larger procedures done, as well as to pause and ask tough questions about the value of specific services when they are at their provider’s office,” Spohnholz said.
Michael McGrady ([email protected]) writes from Colorado Springs, Colorado.
Matthew Glans, “Health Care Price Transparency Laws Could Help Alaska Patients,” Research & Commentary, The Heartland Institute, February 22, 2017.
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