In Mass., You Can Now Get Prices For Health Care In Advance (But It’s No T.J. Maxx)

The form Blue Cross patients fill out if they want an estimated price for health care.

The form Blue Cross patients fill out if they want an estimated price for health care.

“How much will my MRI cost?” It sounds like a simple question. But before Oct. 1, it was very difficult to get an answer.

Now, Massachusetts is pulling back the curtain on what has been a largely secret world of health care prices. A new state law says health insurers must be able to tell members, in advance, how much a test, treatment or surgery will cost. The idea is to help patients become health care shoppers — especially patients who have to pay a lot out of pocket before their insurance kicks in.

Phone Calls And Forms

I threw out my back last week and went to the doctor. She sent me down the hall for X-rays. I may need more. So, I was curious: How much does an X-ray cost? I called my insurer, Blue Cross.

The recorded message didn’t mention health care prices, so I went with, “For all other inquires, press 0.”

On came Jamie D. (customer service reps don’t give out their last names) and I explained that I wanted to compare the price of lower back X-rays at a few different facilities.

“Absolutely,” Jamie said. “Do you know the name of the provider you’re going to be working with?”

I had the doctor’s name, but I didn’t have most of the other information Jamie wanted. Blue Cross, Harvard Pilgrim and Tufts Health Plan will ask you for lots of details before giving you an estimate.

Blue Cross, for instance, wants the procedure and/or diagnostic codes (CPT or ICD-9) for each X-ray I may need, my doctor’s National Provider Identifier (NPI) and the name, address and NPI for my hospital or lab, so it can consolidate all the charges into one estimate.

“Typically with the X-rays there’s going to be a charge for the provider who renders the X-ray and then who’s reading it,” Jamie explained, “so it’s like a professional and a facility charge.”

Jamie directed me to an online form. I called my doctor and got the information. Twenty minutes later I clicked submit, and that was for just one lab. If I wanted to compare prices, I’d have to fill out separate forms for each one. Once I’d submitted all the correct information, Blue Cross had 48 hours to get me an estimate. I guess it goes without saying I’d never do this in an emergency.

So far, it didn’t feel like shopping. The main point of this new requirement is to help patients make smarter choices. We’re supposed to start behaving more like consumers of health care. So where’s the instant gratification I get from finding a designer sweater for $16.99 at T.J. Maxx?

Insurers’ Concerns

Insurers aren’t thinking that way. They all sound a little overwhelmed by trying to put a price tag on medical care.

“The challenge is really about trying to make this information personalized and useful,” said Derek Abruzzese, vice president for strategy and product development at Tufts Health Plan. “Unfortunately, you know, health care is very complex and so it’s difficult to make things simple, straightforward and precise.”

So many things can change when patients actually go in for treatment.

“You know, they needed an extra lab, an extra MRI or some sort of diagnostic that [neither] we, nor the member or the provider for that matter, could have foreseen at the time that estimate was requested,” said Bill Gerlach, director of member decision support at Blue Cross Blue Shield of Massachusetts.

Insurers are also worried about getting the price right because the new state health cost control law puts insurers on the hook if their estimates are wrong.

“If we show an estimate that is lower and someone goes and pays more, then we are liable. We’re working very hard … to be accurate,” said Sue Amsel, who is working on a new health care shopping tool that Harvard Pilgrim Health Care hoped to have up and running this month.

Harvard Pilgrim’s site is delayed until later this fall. Tufts’ shopping tool won’t be ready until the spring. Both are providing estimates over the phone for now.

Blue Cross has a cost estimator for its PPO members and will expand the tool to HMO members early next year. But unlike Tufts and Harvard Pilgrim, Blue Cross will only offer binding estimates for members who fill out a form online or call the 1-800 member line.

In the meantime, Amsel has a demo of Harvard Pilgrim’s “Now I Know” site (see below).

“I’m going to just click on MRI,” Amsel said, showing me on my laptop. Next, she selected a body part, in this case the brain. A new page popped up that showed how much a Harvard Pilgrim member, with a high deductible plan, would have to pay for the most common brain MRI at different hospitals around Boston.

“Here you see that your range is from $372 to $1,223,” she said. Amsel says that kind of range, where one hospital is paid three to four times more for the same test, is not unusual.

Okay, this is not as exciting as my bargain sweater, but Amsel says people who have to spend a lot of their own money before insurance picks up the tab need to know how much their care will cost.

“We know that people are frustrated,” she said. “They go to the doctor not knowing, they come back with a big bill that they didn’t expect. They weren’t able to prepare for it, they weren’t able to plan for it, so I think this will help them quite a bit.”

Your insurer should spell out what’s included and what’s not in the estimate you receive. Pay close attention to what is not part of the estimated price, because you may have to pay for any extras.

A new era is dawning in Massachusetts. We can find out, in advance, how much everything from a blood test to open heart surgery costs. The requirement for insurers began Oct. 1; the same rule takes effect for hospitals in January. But in these early days, getting an accurate price still isn’t quick or easy.

Heres a demo screengrab of the cost calculator Harvard Pilgrim hopes to have ready this fall:

(Courtesy Harvard Pilgrim)

Listen to the audio version of this story below:

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  • MightyCasey

    As usual, the folks (insurers) who actually KNOW the numbers whine “it’s so HAAARD” when we ask for them. It’s not complexity that worries them, it’s that revealing the bottom line will likely show how much that bottom line is inflated by all the various interests involved.

  • fun bobby

    the problem with passing this law at this time is it will make it look like obamacare works when actually the market will now drive prices down. for a market to work efficiently consumers must be able to know the prices of things before buying. they should have done this a while back

  • keltcrusader

    pay close attention to this: “Typically with the X-rays there’s going to be a charge for the provider who renders the X-ray and then who’s reading it,” Jamie explained, “so it’s like a professional and a facility charge.”

    I received an “estimate” from HP for an endoscopy I had performed due to a medical issue. I called to talk to my insurance provider (HP) for an idea of what I would be looking at in charges. After consulting with them, I switched locations to take advantage of their preferred pricing at a particular facility so my cost would be “only” a $75 copay. But what they didn’t tell me was that facility charge was only a very minor part of the estimate. I have now received bills from the attending Dr, Anesthesiologist, Radiology Lab, Radiologist, as well as the copay, resulting in an unexpected $1500 worth of charges that I, in no way, expected based on my phone calls.

    So much for trying to shop and get the best price. I truly feel they left out the total true costs so I would be taken in by the “specific facility” up-sell.

    • Martha Bebinger

      Wow keltcrusader – that’s terrible!

      Under the new rules, insurers are supposed to give you a packaged estimate that includes the provider and facility charges. Your story is an unfortunate reminder that we have make sure all the charges are in the estimate.

      I hope your endoscopy issue is resolved.

  • J__o__h__n

    “Pay close attention to what is not part of the estimated price, because you may have to pay for any extras.” — If these aren’t included in the estimate, it is not much of an improvement.

  • Barbara Anthony

    I think we should consider sending the lawyers out for a lunch break and the rest of us hunker down and figure out how to make this a consumer friendly tool which was the intent of the law. That said, a close reading of the law actually says that the estimates may vary from the actual costs due to unforeseen services or procedures. That is what the law says!
    A carrier in the article says:
    “So many things can change when patients actually go in for treatment.”
    Precisely correct! That is why the law permits estimates to vary if things change. I believe everyone is trying to act in good faith and provide best estimates — but somewhere along the line, a rigid and stringent reading of the law is resulting in thwarting a great idea that has the potential to inject real competition into the healthcare marketplace!
    Let’s roll up our sleeves and work together to make this a real and not illusory benefit for consumers.
    Barbara Anthony, Undersecretary, Consumer Affairs and Business Regulation

  • Josh Archambault

    Martha, Nice once the process is smoother, but kind of pointless if you pay the same co-pay regardless of where you go, right?

    • Anne H

      This is more geared toward those with plans with deductibles or coinsurance, not those with flat rate copayments.

      That said, EVERYONE should be using these tools to understand the high cost of health care especially in Massachusetts. The MRI example is a great example. Hospital MRIs cost so much more because there is more overhead and more hands involved in the procedure (as well as the machinery cost) than a stand alone facility.

      Just because you have an all you can eat buffet of a Platinum (metal tiers anyone?) plan or Cadillac plan, does not mean you should be ignoring the fact that you are going to high cost providers that give you no better results or quality of care than a lower cost provider. By ignoring this, you become a part of the problem.

      (That was not calling you a problem Josh, it was the universal “you”)

    • Phyllis Craine

      I don’t have a co-pay I have a HSA coverage. Don’t assume everyone’s plan works the same way

  • Philip Kousoubris

    Interesting I know how much my institution charges for MRI – and interestingly the media and public are rightly focused on why MRI costs so much. Don’t be mad at the doctors – like me – who don’t own these Ferrari like in cost miracle machines. Instead ask the manufacturers – who are in a 2005 economy mindset- why the incremental improvements in MRI tech since the 1990′s cost more when they are largely based on Moore’s CPU law (increased power x2 with lower cost every ~2yrs). It’s a great “what the market (can’t anymore) bear” question.

    • Martha Bebinger

      Hi Dr. Kousoubris – it is an interesting “what the market can bear” question. But does the machinery cost help explain why an MRI may cost 3-4x more from one hospital to the next?

      • Philip Kousoubris

        Superb question as our hospital MRI Brain charge is significantly different from others. The machine cost is nearly the same (within around 10% +/- best guess). I am only a physician, and the “chargemaster” book charges are best explained by the administrative business executives. The average hospital provider has little insight into pricing contributing factors, but machine cost in general is too high imho. The answer may be opaque.

        • Anon

          Hospital (as well as insurance company) management keeps the “business” of medicine secret from doctors and patients. Transparency hasn’t reached healthcare and for that reason there is much profiteering at the patient’s expense.