Oregon awarded a “B” on health care price transparency—but the state is still failing consumers
OPINION -- We all know that health care still costs too much and delivers too little. The very least we can do is make sure consumers can get prices up front, to enable more informed decisions about value and encourage price competition that could help keep costs in check. OSPIRG has been pushing for years to increase access to accurate, actionable health care price information for Oregon consumers.
So you’d think we would be celebrating when a national scorecard from the transparency advocates at Catalyst for Payment Reform recently gave Oregon a “B” rating—up from an “F” in every prior year—for progress toward making price information more widely available. Unfortunately, there’s much less here than meets the eye.
First, some context. In 2015, the Oregon Legislature passed Senate Bill 900, which requires the state to post median hospital prices for the most common inpatient and outpatient procedures on a consumer-friendly website. This median price data was just recently released, first in a detailed, technical report from the Oregon Health Authority, and then via the website oregonhospitalguide.org, which is maintained by the Oregon Association of Hospitals and Health Systems.
The availability of this data represents a step forward in some ways. The information about variations in cost between hospitals in different parts of the state is suggestive and potentially useful for researchers and policymakers. In fact, it’s already raised some important questions about the impact of high prices in some areas of the state, the role of hospital competition and the availability of affordable health coverage.
However, OSPIRG did not support SB 900 in 2015, and our reasons will be immediately clear from a quick perusal of the report and the oregonhospitalguide.org website. This kind of data simply is not useful for consumers for a variety of reasons, including the following:
- These are median prices. Consumers can’t use this information as a reliable guide to what they will pay with their own insurance because the data is not broken down by insurance company; prices can vary quite a bit depending on where you get coverage. OHA’s report graphically illustrates the range of rates paid by different insurers for the same service at the same facility, which is very large in some cases, but does not break out the data by insurance company, leaving consumers to guess where they may fall on that range. Guessing wrong could make a difference of thousands of dollars in extra costs. A similar prices website in New Hampshire does break down the data by insurance company, which is far more useful for consumers. More or less by definition, the median price is a price no-one actually pays, so it is of very limited value to most Oregonians.
- The data doesn’t include some of the costs that are most important to consumers. The price data is limited to hospitals (not covering clinics, surgery centers or other health care providers), but it also doesn’t cover all of the costs of hospital procedures. Since it only includes the median payments insurers pay to hospitals, it doesn’t include patient out-of-pocket payments and payments to providers that don’t work for the hospital.
- These are historical prices. This data was collected way back in 2014, and since prices for health care services can change substantially from year to year, this is a serious limitation. The Oregon Health Authority most likely cannot report more recent prices because of the way they collect this information through Oregon’s All Payer All Claims database, but consumers really need better access to current, accurate information about what they will pay.
To be fair, the release of this data is a step forward and should be recognized as such. In a national context where only six states received a grade higher than “F” from Catalyst for Payment Reform, suggesting widespread inaction on an urgent consumer need, we know that Oregon’s efforts deserve some recognition.
However, we should not lose sight of the fact that Oregon consumers deserve far better, and this “B” grade should not be considered nearly good enough when the state is still failing to meet the consumer need for access to accurate, actionable information about health care prices. The urgency of this need is especially underscored by recent reports that Oregon hospitals continue to experience historically high profit margins while insurers are hiking rates, losing money and dropping coverage in many parts of the state. When consumers are being asked to pay more and more into a system that is delivering these kinds of results, the very least we can do is ask for more transparency about what we’re really paying, and why.
We’ll keep pushing. The overwhelming majority of the public strongly favors transparency in health care prices, and with enough public support, we know we can win real change.  Not all doctors practicing in a hospital are hospital employees. For example, anesthesiologists and pathologists often work in a hospital on a contract basis, and bill for their services separately from the hospital’s charges. Sometimes these bills are not covered by insurance even when insurance does cover the hospital bill, leading to large surprise bills for patients.
OSPIRG is working to create some protections for Oregon consumers who get stuck with a surprise bill, but in the meantime, it is important to understand that this price data does not include those charges. This means not only that the data does not include all the bills a patient may have to pay, but that the data may be systematically under-reporting certain costs, such as
the cost of facilities that use a lot of contract providers, or services that often include contract providers.
Jesse O’Brien is policy director of OSPIRG.