Maryland launches price tool for common procedures

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The Maryland Health Care Commission has launched a new online pricing tool.

The Maryland Health Care Commission has launched a new online pricing tool that allows state residents to compare the costs of several common procedures. 

The "Wear the Cost" initiative provides prices from hospitals in the state for hip replacements, knee replacements, hysterectomies and vaginal births. The calculations are based on commercial insurer data from 2014 and 2015. Development support on the project was provided by the Altarum Institute. 

In a blog post for Health Affairs coinciding with the website's launch, pricing experts and past and present leaders from the state's healthcare commission noted that consumer engagement—particularly around price—is "critical to reforming the healthcare market." 

"With the nation struggling to find a path toward high-quality, affordable and accessible care, the benefits of illuminating both quality information and underlying costs is a rare area of bipartisan agreement," the post said. "Maryland’s effort may lead the way." 

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In addition to pricing data, Wear the Cost offers resources for patients to learn more about having conversations about healthcare costs with their doctors and comparing provider quality. 

The website breaks costs down into what patients might expect to pay for during an episode of care, and the unexpected costs that can occur. For example, the hospital with the highest listed cost for a hip replacement was MedStar Good Samaritan Hospital in Baltimore, with a full cost listed of $42,030. 

Of that, the vast majority ($41,229) is tied into the expected costs for the procedure itself: inpatient costs, outpatient costs, prescriptions and professional services like physical therapy. The remaining amount ($801) represents the costs incurred from avoidable complications like pressure ulcers and hospital-acquired infections. 

The site also notes which hospitals have higher rates of cost incurred from complications; for hip replacements, for example, Sinai Hospital was listed as "above average" for potentially avoidable complication rate, as it had the highest spending on those complications and the highest readmission rate. 

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Not everyone is convinced that Maryland's approach will be effective. Kevin Volpp, director of the University of Pennsylvania's Center for Health Incentives and Behavioral Economics, told The Washington Post that patients often view price as a sign of quality and may opt for more expensive options. 

"As a general point, I would agree that it's good for people to know more than less about the price and quality of different options," Volpp told the publication. "I think it's very likely that it's going to drive people to higher-priced providers." 

Patients themselves are also lukewarm toward price transparency tools. About 13% of the respondents to a recent study said they viewed price comparison data, but just 3% used that information to make a decision about their care.