Report: This is the biggest barrier to consumer price shopping in healthcare

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Patients don't find price transparency tools useful enough to use, so a group of Harvard Medical School researchers looked into what it might take to make them work. (Pexels)

Advocates of price transparency in healthcare believe free-market competition will help curb costs.

But while patients claim they want tools that will allow them to comparison shop for the best prices, that interest hasn’t translated into actual use of available tools, according to a new report from Harvard Medical School researchers.

The main reason? It's confusing, according to their report, published in the New England Journal of Medicine,

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“I’m a physician and a researcher who studies prices in healthcare, and when I tried price shopping for procedures for my own family, I found it confusing and frustrating,” said lead author Ateev Mehrotra, M.D., M.P.H., associate professor of healthcare policy and medicine at Harvard Medical School and a hospitalist at Beth Israel Deaconess Medical Center, in an interview with a Harvard Medical School newsletter. 

RELATED: Patients lukewarm toward price transparency tools

Even with good pricing information, patients don’t always fully understand what they need, Mehrotra said. He points to detailed medical terminology as a major point of complexity for patients.

Hospital billing systems are complicated and procedures could easily wind up generating charges owed to multiple providers. If a patient gets charged by both a radiologist and a facility for an MRI, for example, Mehrotra said it can be unclear whether the quoted price includes one charge or the other, or both.

Patients tend to hesitate about making healthcare decisions based solely upon price, especially when their doctor gives them a referral.

RELATED: Providers call for transparency, balanced risk in future CMS payment models

What's the fix?

Patients need to have a solid idea of the cost of a given procedure before they leave their doctor’s office so that they at least have some basis on which to compare prices, Mehrotra said.

In addition, price transparency tools need to be able to crunch numbers that take into account variables including insurance providers, facilities, practitioners and labs so patients understand what their actual out-of-pocket cost will be under a given scenario, he said.