PragerU’s latest video features Will Bruhn, co-founder of Restoring Medicine, a grassroots movement of doctors, nurses, students, business leaders, and everyday citizens from across the United States that are demanding a more honest and fair health care system. The key to bringing down the soaring costs of health care, Bruhn contends, is price transparency.
Bruhn begins by highlighting how prices for the same procedure can differ wildly by hospital or provider. When “researchers compared prices amongst 53 hospitals for a standard heart procedure,” not only did they find a “10-fold difference in price for the same procedure across hospitals, ranging from $44,000 dollars to $448,000 dollars,” but also that there was “no correlation between higher prices and better quality of care.” This is not an isolated incident, given that “other studies have shown there can be up to a 39-fold variation in price for a simple blood test across medical centers in the same metro area,” he adds.
The issue, Bruhn argues, is that “we have no idea how much we’re paying for healthcare services,” and when it comes to medical procedures, consumers are unable to “shop” for a satisfactory price in the same way as airline travel.
“Imagine if the airlines didn’t post prices,” Bruhn asks. Instead of knowing the price in advance, you will be billed after your flight because the airlines “don’t know what the cost of fuel will be that day.” This, Bruhn says, is “precisely what we are dealing with in American healthcare.”
Continuing, Bruhn states that the reason you don’t know how much a procedure or treatment costs prior to being treated is because medical billing is “a ridiculously complex dance between hospitals, insurance companies and various middlemen.” Not only do private agreements and “secret deals” determine the price, “medical costs are skyrocketing” for patients, meaning that “Americans are having more and more trouble paying the bill,” with nearly 20% of Americans in some form of medical debt.
Those who have insurance through their employers, Bruhn warns, also aren’t safe, with wage increases failing to keep up with employee contributions to healthcare premiums. The result? “That salary increase you so richly deserved was eaten up by the increased insurance premium you had to pay.”
What makes matters worse, according to Bruhn, is that “the ever-increasing cost of medical care” is not “reflected in the quality of the care you were getting,” with “little or no correlation between what you pay and what you get.” This raises the obvious question: “How do we get out of this mess?”
“A big part of the answer,” Bruhn says, “is price transparency, something almost every American wants,” with “almost 9 out of 10 Americans say they favor price transparency for medical services.”
Bruhn argues that this makes perfect sense, since Americans don’t have access to either of the two factors which ensure that they have the proper information to make an informed decision: price and the quality of a good or service. Not only that, since “60% of healthcare is shoppable,” such services present opportunity for competition.
Bruhn also states that the benefits wouldn’t end there. Citing an estimated annual wastage of $760 billion in the US healthcare system due to “administrative complexities,” transparent upfront prices would allow medical centers to “cut a significant portion of their administrative staff that’s now involved in billing and debt collection.”
“Furthermore,” Bruhn continues, “if pricing was transparent, Americans could actually start pushing the market towards rewarding those who offer a fair and honest price, and pushing out the bad actors.”
Ultimately, more Americans would have access to healthcare.
Concluding, Bruhn argues that “we don’t need the government to take over our health care.” Instead, “we need the government to get out of the way.” Pointing to procedures like laser eye surgery, MRI testing and plastic surgery as positive examples, Bruhn says we should “let entrepreneurs innovate in the healthcare space,” since when they do, “prices go down and quality goes up.”
“Price transparency not only lowers costs, but it puts the patient back in the center of what medicine is all about: helping those in a time of need,” Bruhn concludes.
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