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Health Insurance & Affordable Care Act

Healthcare Cost Comparisons? Colorado Is Trying

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“Claims data is dirty,” says Sonn.  “It's really dirty. It takes a lot of scrubbing to make sense of it. It's complicated, time consuming and expensive.”

Colorado has had funding to do that from private grants, but those are drying up. In order to keep on making basic price information accessible to the public for free, they want to sell more complicated, custom data reports to businesses within the health industry.

There is a growing market for those, says Dr. David Ehrenberger, the chief medical officer for Avista Adventist hospital outside Denver. He would like to see reports that show not just how much his competitors are charging, but also whether their patients have more or fewer complications. That will give him better negotiating power with big insurance companies.

“The insurance industry still has a dramatic advantage over particularly smaller physician groups and smaller health care organizations. There's not a level playing field there,” Ehrenberger explains.

That's because big insurance companies pay bills at hospitals all over the state, so they have a big picture view of how much everybody charges for procedures and details such as complication rates. Individual hospitals only know their own prices.  It’s as if only customers could get a list of prices for different coffee makers, but Cusinart and Mr. Coffee can't, so they don't know if they're asking too much or too little for their coffee makers. The better picture Ehrenberger can get of the marketplace for health care services, the better he can set prices.

“What we want to do is be able to have the data that shows, unequivocally, that we can provide a better quality product, and a cost they can afford,” he says.

But there’s a glitch.  In order to get the kinds of reports Ehrenberger and other health care providers want, they have to include price information from all payers, and one of the biggest is Medicare -- it pays about a fifth of all health care bills in Colorado. At the moment, Edie Sonn explains, they cannot use that Medicare data in any of the custom reports they want to sell.

Sat, Feb 15 2014

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