Changing the way people look at their costs and benefits
The rising cost of health care
Why transparency is so important
What the government is doing about transparency in health care
Aetna’s commitment to health care transparency
Transparency cost and clinical quality information available through Aetna Navigator™
As our government acknowledges, we do not have a true health care “system.”1 Instead, it’s a sometimes disconnected collection of health care professionals, hospitals, insurance companies, agents, brokers and consultants, and public and private employers – all providing vital support while doing their best to deal with internal and external pressures.
This environment has made it challenging for Americans to truly understand medical costs, select quality service and exercise control over their own health care.
Access to this information is becoming increasingly important as the move toward consumer-directed health care continues to grow. But while it’s possible to comparison shop for almost anything else – from a car to a toaster oven – before making a purchase, that’s not the case with health care. This is also an important factor in the continuing rise in health care costs.
But a change is underway in the form of health care transparency.
"Every American should have access to a full range of information about the quality and cost of their health care options."1
- Health and Human Services Secretary Mike Leavitt
Health care consumers making informed choices about their care – that is the goal. Let’s examine how to get there …
Most of us know that health care costs have gone up – about 12 percent in recent years. But few of us know the specific costs contributing to our own health care bills. An average of only 10 cents of every dollar spent on doctors’ services comes directly out of the consumer’s pocket; the rest is paid by a third party.2
Thanks to the managed care culture, a person went to the doctor, had tests done, maybe underwent an outpatient procedure, paid the $5, $10 or $20 copayment and that was it. No further questions.
A Harris poll found that consumers were off by $8,100 when asked to estimate the cost of a 4-day stay in the hospital. Also, 63 percent of people who received care in the previous 2 years didn’t know how much their treatment cost until they received the bill. Another 10 percent never learned the cost.2
The fact is, even some doctors may lack awareness of true health care costs. In a recent study of staff doctors and residents, the doctors consistently underestimated the actual costs of care.3
This is one of the major stumbling blocks to achieving true consumerism in health care. Until consumers are able to take cost into consideration when choosing what doctor to see or where to have a procedure done, they can’t make a truly informed decision. There is also no incentive for the doctors and facilities to increase their cost efficiency.
Another key issue is that there’s a lot more to health care than the cost of a doctor’s office visit or procedure. It will never be as simple as comparing airline fares and arrival times. Cost information needs to be organized around “episodes of care” which incorporate all the costs involved in caring for an illness. An episode of care takes into account the level of office visit needed, as well as any tests, procedures or referrals to other health care professionals.
According to Robert B. Doherty, Senior Vice President for Governmental Affairs and Public Policy of the American College of Physicians, “Any transparency model we adopt must be created specifically for and by those who deliver and receive health care services, instead of being one grafted onto medicine from another industry.4
Efforts to achieve this are underway, with a great deal of input from insurers and payers such as Aetna, to develop standards for comparing the costs of an episode of care.
Clinical quality as well as cost
The quality of health care is also extremely important – and difficult to measure, especially when dealing with complex or urgent health issues.
Up to very recently, information concerning doctor and hospital quality was pretty much passed along by word of mouth, friends telling friends. The Internet has changed all that. At little or no cost, “report cards” on hundreds of thousands of doctors are now available online.
According to a report by the Commonwealth Fund, studies of public reporting of the cost and clinical quality of health care have found that it can add value, but the reports must be designed carefully. Unobtrusive data collection and collaboration between health care professionals and payers are also important.5
The Health & Human Services (HHS) website lists some organizations of insurers and health care professionals that have already joined forces to create standards and measures for health care clinical quality. Click here for more information.
Aetna at the forefront of value-driven care
We are proud to say Aetna “got the ball rolling” in 2004 by providing our members with information about doctors’ clinical performance and cost efficiency information. Since that time, we’ve been working with doctors, members, employers, medical associations and national health care coalitions to further develop our health care transparency initiatives.
Aetna’s health care transparency initiatives timeline:
Aetna expands transparency
Many Aetna members seeking to become better health care consumers will now have access to information that no other health plan is making available – a combination of cost, clinical quality and efficiency information about individual doctors. As of April 2007, our members will have access to clinical quality and efficiency information for 22,517 specialist doctors and specific pricing for more than 100,000 doctors.
“Providing reliable cost and quality information empowers consumer choice. Consumer choice creates incentives at all levels, and motivates the entire system to provide better care for less money.6
Others agree. According to the Commonwealth Fund, transparency and better public information on cost and quality are essential to:
Consumers are already being asked to shoulder a greater portion of health care costs as medical costs rise and employers turn to offering consumer-directed high-deductible health plans to reduce overall business expenses. Transparency will give them the information they need to make the health care decisions that are right for them.
Transparency also adds an important resource to Aetna’s expanding toolbox that already includes the Aetna Navigator™ Hospital Comparison Tool and the Estimate the Cost of Care tool.
Ultimately, our goal is to provide our members with industry-leading decision-making tools and information that will help them make the most informed health care and health care financial decisions for themselves and their families.
In August 2006, President Bush signed an Executive Order on health care transparency requiring federal agencies to make health care quality and price information available to consumers. As part of this order, the Secretary of the Department of Health & Human Services (HHS) in November issued a Statement of Support for the Four Cornerstones of Value-driven Health Care and encouraged large national employers to sign it.
Demonstrative of our leadership position on transparency, Aetna was the first health plan – and one of the first Fortune 100 employers in the country – to sign this statement.
The Four Cornerstones of Value-Driven Health Care are:
In keeping with our long-term commitment to improving the nation’s health care system, we continue to release doctor-specific information on health care costs and clinical quality; expansion of our high-performance network of specialists; and the introduction of a consumer-centric Personal Health Record – all this with your clients and their employees in mind.
For more information on the federal government’s health care transparency efforts, go to http://www.hhs.gov/transparency/
Four Cornerstones: http://www.hhs.gov/transparency/fourcornerstones/index.html
As we develop our transparency initiatives, we are very careful in soliciting feedback from the employer, consumer and doctor communities in order to provide information in a way that is fair, useful and relevant. We continue to solicit feedback on our efforts, and expect that our transparency initiatives will grow over time.
We will continue to partner with organizations committed to quality measurement and improvement, such as:
We will continue expanding the program throughout 2007 to new markets and, ultimately, we expect to offer the program nationwide. View a map of Aetna health care transparency market availability.
Here are some specifics about the direction of our transparency initiatives...
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For more information on Aetna’s health care transparency initiatives, please review our brochure.
The future of health care transparency
The advantages of health care transparency are obvious – better clinical quality, lower costs and the information consumers need to make health care decisions. The hard part is achieving it.
While the complex nature of health care makes comparing costs much more complicated than shopping for airfare or most consumer goods, it is possible to provide consumers with the information they need to choose the care that is best for them based on both price and quality.
The Executive Order signed by President Bush last August, along with the Four Cornerstones of Value-Driven Health Care proposed by the HHS, are important first steps. But it’s up to all of us – health care professionals, hospitals, insurance companies, agents, brokers and consultants, and public and private employers – to work together and make it happen.
Useful links
Value-Driven Health Care: A Purchaser Guide
U.S. Department of Health and Human Services, Value-Driven Health Care
* Financial and legal services and educational tools are provided by independent contractors who are solely responsible for the services and information they provide.
1. U.S. Department of Health and Human Services. Available at: http://www.hhs.gov/transparency/. Accessed April 5, 2007.
2. Goodman JC. Transparency in Health Care. National Center for Policy Analysis. Brief Analysis No. 548. March 29, 2006. Available at: http://www.ncpa.org/pub/ba/ba548/. Accessed April 5, 2007.
3. LePage AA, Vukov L, Johnson DQ. Physician and Nurse Awareness of Health Care Costs in Common Emergency Department Patients. Acad Emerg Med. 2006. Volume 13, Number 5_suppl_1 52-53, Available at: http://www.aemj.org/cgi/content/abstract/13/5_suppl_1/S52-b. Accessed April 10, 2007.
4. Doherty RB. The promise – and challenge – of health care “transparency.” ACP Observer, May 2006. Available at: http://www.acponline.org/journals/news/may06/washington.htm. Accessed April 5, 2007.
5. Colmers JM. Public Reporting and Transparency. The Commonwealth Fund. February 2007. Available at: http://www.cmwf.org/publications/publications_show.htm?doc_id=449503. Accessed April 6, 2007.
6. Value-Driven Health Care. U.S. Department of Health & Human Services. Available at: http://www.hhs.gov/transparency. Accessed April 10, 2007.
7. Collin SR, Davis K. Transparency in Health Care: The Time Has Come. The Commonwealth Fund. March 15, 2006. Available at: http://www.cmwf.org/publications/publications_show.htm?doc_id=361215. Accessed April 10, 2007.
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