Consumers in the Dark on Health Care Prices and Quality

By: Amit Rao

A reason the Clear Choices Campaign came together is because we believe it is wrong that consumers often lack basic information about costs and quality when making health care decisions. The latest Kaiser Family Foundation (KFF) Health Tracking Poll paints a scary picture of just how widespread this information disconnect really is, and stresses the need for reforms that improve transparency on health care prices, quality, and safety. KFF surveyed consumers’ personal health care experiences and perceptions among a nationally representative sample of 1,506 adults from April 8-14, 2015. The highlights of the survey are outlined below and point to the pressing need to enact policy changes that leverage existing data and technologies to improve health care transparency.

Limited Comparative Information

Consumers have very little information to help them compare different health care options. Overall, KFF found that 31 percent of consumers report seeing information comparing doctors, hospitals, and health insurance plans in the past 12 months. However, when asked specifically about information comparing prices or quality across plans and providers, fewer than 1 in 5 report seeing such information.

When more than 80 percent of consumers lack comparative information on prices and quality, it is not surprising that consumers often make poor decisions that increase health costs.

Finding Information on Costs Even More Difficult

Unfortunately, the problem is even worse for consumers seeking upfront information about the costs for their particular care. KFF reports that nearly two-thirds (64 percent) of consumers report difficulties in finding out how much medical treatments and procedures provided by different doctors or hospitals would cost them. These difficulties are exacerbated for the uninsured, of which three-quarters (76 percent) say it is difficult to find out how much medical treatments would cost.

The pressure of rising health costs and the trend towards more consumer out-of-pocket spending creates an unprecedented need for greater health care transparency. Increased cost sharing, including ACA’s propagation of high deductibles, means consumers need shopping tools now more than ever. For example, the average deductible for a 2015 ACA exchange silver plan is $5,800 for a family, or about 10 percent of a typical family’s income. Just meeting obligations under such a deductible forces families to shop for value. Yet consumers cannot be expected to make better quality- and cost-sensitive decisions about their care if they remain in the dark about the value offered by potential health providers and insurance plans.

This problem is a driving force behind the Clear Choices Campaign. Americans need better policies that help shed light on prices, quality, and safety in our health care system.