How Much Will It Cost? How Americans Use Prices in Health Care

March 17, 2015

As Americans shoulder more health care costs, this Public Agenda research suggests that many are hungry for more and better price information. However, some obstacles remain to increasing the number of Americans who compare prices before getting care.

While insurance companies and vendors are developing tools to make out-of-pocket health care prices more transparent, price information remains largely hidden. Nonetheless, 56 percent of Americans have actively looked for such information before getting care, including 21 percent who have compared prices across multiple providers. Those who have compared prices say doing so has affected their choices and saved them money.

Others say they sought out price information for just one provider, including by asking a receptionist, friend, relative or their insurance company, or by looking for the information online, but haven’t compared prices across multiple providers.

At the same time, most Americans do not think price indicates the quality of care. Seventy-one percent say they do not think higher prices indicate better quality care and 63 percent do not think lower prices are typically a sign of lower-quality care. Many may be ready to choose less expensive care.

Together, these findings suggest that Americans are open to looking for better-value care.

However, most Americans remain unaware that prices can vary across health care providers. A significant number of insured (57 percent) and uninsured (47 percent) Americans are not aware that physicians might actually charge different prices for the same services.

Respondents also seem split on whether people should be expected to compare prices for medical care. Forty-three percent say it is not reasonable to expect people to compare prices before getting care.

The research was supported by the Robert Wood Johnson Foundation and findings are based on a nationally representative survey of 2,010 adults conducted in 2014, along with focus groups and follow-up interviews.

Findings and implications are summarized below. You can download a PDF of the full report, “How Much Will It Cost? How Americans Use Prices in Health Care,” here and a summary of the research here.

Finding 1: The majority of Americans have tried to find information about health care prices before getting care.

  • 56 percent of Americans say they have tried to find out how much they would have to pay out of pocket, not including a copay, or how much their insurer would have to pay a doctor or hospital, before getting care.
  • People with higher deductibles are more likely to have sought price information: 67 percent of those with deductibles of $500 to $3,000 and 74 percent of those with deductibles higher than $3,000 have tried to find price information before getting care.
  • People with college degrees and women are more likely to have sought price information than those without degrees and men, 62 percent of those with college degrees and 59 percent of women report having done so. Only 40 percent of retired Americans report having done so.
  • There are no significant differences by income, age or race/ethnicity in whether or not people have sought price information when taking into consideration other relevant variables.

 

Finding 2: Most Americans seem open to looking for better-value care.

  • 71 percent of Americans say higher prices are not typically a sign of better-quality medical care.
  • 69 percent of Americans say insurance companies should be required to make public how much they pay doctors for medical services.
  • Even among those who have not ever tried to find out a price before getting care, 57 percent say they would like to know the prices of medical services in advance, and 43 percent would choose less expensive doctors if they knew the prices in advance.

 

 

Finding 3: Looking for price information does not necessarily mean comparing prices.

 

  • About one in five Americans, 21 percent, say that when trying to find price information before getting care, they have compared prices across multiple providers.
  • 33 percent say that when trying to find price information before getting care, they have checked prices from just one provider.
  • People who have compared prices across multiple providers are more likely to make health care decisions for adult family members: 53 percent of those who have compared prices across providers make such decisions, compared with only 34 percent of those who have checked prices from just one provider.
  • People who have compared prices across multiple providers are more likely to receive regular medical treatment: 42 percent of people who have compared prices before getting care receive regular medical treatment, compared with 33 percent of those who have not ever sought price information before getting care.
  • Hispanics, African-Americans and younger people are more likely than other groups to have compared prices across multiple providers. Those with incomes over $100,000 are less likely than those with lower incomes to have compared prices.

 

 

Finding 4: Comparing prices, many Americans say, has saved them money.

  • Among Americans who have compared prices across multiple providers, 62 percent believe that they have saved money.
  • 82 percent of those who have compared prices across multiple providers say they will do so again in the future.

 

 

Finding 5: Some obstacles stand in the way of increasing the number of Americans who compare prices before getting care.

  • 57 percent of insured Americans do not think some doctors covered under their insurance plans charge more than others for the same services.
  • 43 percent of Americans say it is not reasonable to expect people to compare prices before getting care.
  • 50 percent of those who have never checked a price are unsure how to find price information.

 

 

Finding 6: Insurers, providers and office staff can play key roles in helping Americans manage their health care spending.

  • 69 percent of Americans say a website showing how much different doctors charge would help them with their health care spending.
  • 64 percent of Americans say that after a doctor’s appointment, they would find it helpful to get an estimate from the receptionist of how much their bill will be.

This research suggests many people are hungry for price information. Our report concludes with implications based on these findings for policymakers, insurers, employers and providers who are interested in engaging more Americans in comparing prices and choosing better-value care.

  • Strengthen the capacity of providers, staff and insurance company personnel to discuss prices: The finding that many Americans are already trying to get price information from receptionists and hospital staff, insurance companies, doctors, hospital billing departments and nurses suggests a need to strengthen these professionals’ capacity to provide and discuss price information.
  • Help people understand that prices vary: Most Americans are not aware of price variation. This may keep them from comparing prices or looking for less expensive providers when they are quoted a price that they cannot afford. Policymakers, insurers, employers and providers may wish to consider how to help more people understand the types of care for which prices do and do not vary.
  • Help people understand how to find price information: Most Americans who have not ever sought price information say they would like to know the prices of medical services in advance. Half of them, however, say they do not know how to find it. This suggests a need for more outreach and education about reliable sources of price information.
  • Focus engagement efforts on people who care for others and those who receive regular medical care: Americans who have compared prices are more likely than others to be helping adult family members make health care decisions or receiving regular medical care themselves. Those making efforts to engage more people in comparing prices may wish to focus on these people, who may also be those most in need of savings on their out-of-pocket expenses.
  • Recognize the challenges to engaging people in both seeking and comparing prices and in choosing better-value care: Our follow-up interviews suggest that some people are comfortable with their current providers and do not want to switch even if they could save money, while some live in regions where they feel they have little choice of providers. Our follow-up interviews also suggest that some people feel that the prices they find are unaffordable.

Press Coverage

Price transparency is key to a functional health-care market
(The Hill, Wednesday, April 17th, 2019)

Cassidy Unveils New Ideas to Make Health Care Affordable Again
(Senator Bill Cassidy, Tuesday, May 29th, 2018)

Healthcare Consumerism and Payer-Provider Relationships
(Advance Healthcare Network, Monday, November 14th, 2016)

Does Media Attention Highlighting Hospitals with High Charges Lead to Charge Reductions?
(Journal of Health Care Finance, Saturday, October 1st, 2016)

Patients, Physicians, And Price Transparency: If You Build It, Will They Come?
(Health Affairs, Wednesday, August 31st, 2016)

Healthcare Prices & Quality of Care
(Physician’s Weekly, Monday, August 8th, 2016)

Just three states earn an ‘A’ grade for price transparency in new report
(Advisory Board, Thursday, July 28th, 2016)

Trouble with Transparency in Health Pricing
(Human Resource Executive, Tuesday, July 5th, 2016)

Patient Engagement & Use of Evidence
(Health Affairs, Friday, July 1st, 2016)

Health Care Shopping Tools Usually Go Unused
(Society for Human Resource Management, Thursday, May 19th, 2016)

New website helps patients comparison shop for health care
(The Boston Globe, Sunday, April 3rd, 2016)

The Payment Reform Landscape: Where We Started On Transparency Tools And Where We Need To Go
(Health Affairs, Thursday, March 31st, 2016)

Price Transparency Still Missing from Hospital Revenue Cycle
(RevCycleIntelligence, Tuesday, February 23rd, 2016)

Yes, People Shop for Health care. But are they Good at it?
(The Health Care Blog, Thursday, November 19th, 2015)

How to Teach People About Health Care Pricing
(Harvard Business Review, Tuesday, September 29th, 2015)

California’s new website compares medical costs, insurance payments
(Health Care Dive, Thursday, September 24th, 2015)

California launches price transparency tool but lacks provider-specific data
(Modern Healthcare, Tuesday, September 22nd, 2015)

Face-to-Face Price Transparency
(The American Journal of Managed Care, Tuesday, July 14th, 2015)

Survey: Price Information Difficult to Obtain From Massachusetts Hospitals
(Pioneer Institute, Wednesday, June 24th, 2015)

Study: Americans Hungry for Healthcare Pricing Data
(Healthcare Informatics, Thursday, June 18th, 2015)

The Future of Price Transparency
(Fierce Health Finance, Thursday, June 11th, 2015)

ASC Update: New Truths about Health Care
(OR Source, Tuesday, June 2nd, 2015)

A Foundation Delves Into Health Care Price Transparency
(Health Affairs Blog, Thursday, May 21st, 2015)

Starts Now: Healthcare Cost Transparency Project
(MedPage Today, Thursday, May 14th, 2015)

Price Transparency: The Healthcare Consumer’s View
(Sitewire Health, Friday, May 8th, 2015)

Consumers Want to Comparison Shop When It Comes to Healthcare, But Prices Are Hard to Find
(Main St, Thursday, May 7th, 2015)

Consumers Want to Comparison Shop When It Comes to Healthcare, But Prices Are Hard to Find
(The Record, Thursday, May 7th, 2015)

Health care prices are more transparent, but are patients using the data?
(USC Annenberg, Wednesday, May 6th, 2015)

Research Roundup – April 2015
(Consumers Union, Friday, May 1st, 2015)

Whom Does Health Care Serve: Patients, Consumers or People?
(Hospitals & Health Networks, Tuesday, April 28th, 2015)

Pricing Transparency Trends and How to Achieve It
(Revenue 360, Friday, April 24th, 2015)

Three Key Lessons from the Health Care Transparency Summit
(RWJF Culture of Health Blog, Thursday, April 16th, 2015)

The Payment Reform Landscape: Impact On Consumers
(Health Affairs, Wednesday, April 15th, 2015)

Shopping for health care: Have an ‘awkward conversation’ with your doctor
(KPCC, Wednesday, April 8th, 2015)

What�s New in Health Care Cost Transparency?
(Altarum Institute, Thursday, April 2nd, 2015)

Why Health-Care Price Transparency Isn’t Enough for Consumers
(Wall Street Journal, Thursday, March 26th, 2015)

More people are shopping around for health care than you might think
(89.3 KPCC, Tuesday, March 24th, 2015)

Price Transparency, Value-based Care, King v. Burwell and More
(Sitewire Health, Friday, March 20th, 2015)

Majority of Americans want cost information before care
(Becker’s Hospital CFO, Thursday, March 19th, 2015)

Debate continues over length of CHIP extension
(Politico PULSE, Wednesday, March 18th, 2015)

Most consumers are in the dark about health care costs
(Consumer Affairs, Wednesday, March 18th, 2015)

4 price transparency considerations for providers
(Fierce Health Finance, Tuesday, March 17th, 2015)

Consumers want price transparency but obstacles remain
(Managed Healthcare Executive, Tuesday, March 17th, 2015)

Two Oregon bills target health care cost transparency
(Statesman Journal, Monday, March 16th, 2015)

Commentary

Americans Are Eager for Price Information, New Survey Finds
(Health Affairs, Thursday, March 26th, 2015)