By Janet Fang
Posting in Healthcare
Like the Travelocity of healthcare, a San Francisco startup lets patients comparison shop.
Most Americans don't know how much their medical procedures cost until after they receive the treatment. And that's pretty stressful considering how -- within a single zip code -- a colonoscopy could cost anywhere from $563 to $3,967.
Founded in 2008, the company offers computer-based tools for comparison shopping of healthcare. It's like Travelocity or Cars.com.
For example, EKGs can range from $27 to $143, while the price for a set of three spinal x-rays varies from as little as $38 to as high as $162.
And these days, even the 59.5 million Americans who get health benefits through large self-insured employers are increasingly expected to pay a percentage of the costs for their medical care.
- So, the company sells its tool to employers, who pay a fee per covered member per month.
- And in turn, the company offer employees access to their pricing databases so they can become more responsible users of their benefits. (Current customers include Safeway and Life Technologies.)
Data on medical costs are gathered mostly from statements of benefits that insurers provide to large employers after workers' claims have been paid. The company also provides information about quality and aggregates patient reviews from consumer websites.
As my former coblogger Dana Blankenhorn reported, Castlight Health (formerly Ventana) announced a $60 million capital infusion back in June 2010, which brought their total to $81 million. The team is headed by CEO Giovanni Colella, an entrepreneur whose last company, Relay Health, developed the idea of secure doctor-patient online communications. Cofounder Todd Park was called upon in 2009 to become chief innovation officer of the US Department of Health and Human Services.
The company's growth depends in part on cooperation from insurers -- like the prices they pay doctors and hospitals. However, this kind of consumer-empowering transparency doesn't benefit insurers or providers.
From Technology Review.
Image by RambergMediaImages via Flickr
Nov 29, 2011
It would also be good to see a ranking tied to the prices. Once consumers see prices as well as something that indicated the cheaper guy also had fewer problems, quicker recovers, etc. then the race would be on for providers to compete in giving you the most cost effective care.
...I can attest to the difficulty in trying to find out the cost of it before consuming it. Even today, if you walk into nearly any medical office and ask someone in the window how much a given service costs, you will almost always get blank stares. They don't know. More often than not, there's a "secret price" that is negotiated between your provider and your insurance company that is almost impossible to know until after the service is performed. This makes making rational consumer decisions practically impossible. And of course, since most people don't even pay for their own care (up front, anyway) they never even know what the costs are. And they don't care. (Or don't want to know) This is why I actually think it's a good thing that more people are being made to pay more for their own care. It's difficult paying cash in a world where most people bid prices to the stratosphere because they don't feel as though they have any skin in the game. What health care in America needs more than anything else is transparency. And finally, we're starting to get some.