3 reasons payers don't profit from online price comparison tools

Money

Consumers aren’t using online tools to compare costs of different providers and settings, potentially leaving billions of dollars in healthcare savings on the table every year, the New York Times reported.

Among the reasons, according to the article:

  1. Online tools aren’t convenient for regular or repeat use.
  2. Members don’t have time to shop around in emergencies.
  3. Members don’t always care about costs above and beyond their out-of-pocket expenses.

A study released in March by the nonprofit Health Care Cost Institute (HCCI) concluded that the potential gains from the consumer price shopping aspect of price transparency efforts are modest.

“For a healthcare service to be ‘shoppable,’ it must be a common healthcare service that can be researched (“shopped”) in advance; multiple providers of that service must be available in a market (i.e., competition); and sufficient data about the prices and quality of services must be available,” according to the study, which referred to other research finding that only about one-third of total healthcare dollars are spent on shoppable services.

The HCCI study also blamed transaction costs that make the “costs of shopping appear to be higher than the perceived benefits.”

- here’s the Times article

-  check out the HCCI study (.pdf)