Will Hospital Price Transparency Impact the Patient-Physician Relationship?

By Pamela J. Gallagher

The relationship between physician and patient, has been the foundation of healthcare, built on empathy, honesty, and trust.  Will moves toward increased price transparency change this foundational aspect of healthcare?

Patient-physician relationship

While there is wisdom in using pricing information from various hospitals and clinics when shopping services such as MRIs or routine blood tests, the ability to price-compare facilities or major surgeries could potentially disrupt the patient-physician relationship. For some, a difference in cost would be enough to make them go to a different hospital or request a different prescription than the one their doctor recommends. An overemphasis on cost when making care decisions may lead people to question what their doctor says and make it difficult to work together toward their long-term health goals.

Physicians want to provide the best outcomes to those in their care, so it can be particularly frustrating when costs get in the way of the optimal course of treatment.  On the other hand, it is increasingly important that doctors understand the costs associated with the recommendations they are making to their patients.  

As one doctor explained in an article on RevCycle Intelligence: “We do procedures in the hospitals, we do procedures in the office, and we do procedures in the ambulatory surgery center. Each location has a different cost associated with it, even though it’s an identical procedure.” 

Higher-than-expected costs associated with care, such as learning the price of a newly prescribed medication only once the patient has reached the pharmacy counter, could move a patient to non-adherence. Non-adherence leads to negative health outcomes for patients and increases the potential for higher costs of care in the long term.

Healthcare organizations should ensure their medical staff has an understanding of and easy access to pricing information and patients’ insurance benefits so they can have informed conversations with their patients, answer questions, and decide on the best course of action that works with a patient’s financial limitations while also giving them the care they need. Doctors have the opportunity to be their patients’ ally and advocate by understanding the cost of the care they recommend.

Presenting the full picture

Representing 120,000 physicians and medical students, the American College of Physicians (ACP) shared concerns in a hearing of the House Ways and Means Committee that pricing data is currently accessible in a format that is understandable to industry professionals, but not to patients.  The ACP also urged the federal government to “look beyond unit pricing of physician services and to consider alternative models that would make the overall quality and efficiency of health care transparent to consumers.” 

In a Health Services Research study on what influences patients’ healthcare decisions, researchers concluded that there is substantial room for targeted quality information about healthcare providers in patients’ decision processes. Patients will see reduced cost of care in the long run if they also have an eye toward the quality of the care they receive.  As pricing structures are made public to empower patients to make wise decisions for their health and their pocketbook, information on the quality of physicians and healthcare providers should be presented alongside the cost of care.  

The patient-physician relationship provides the quality care and expertise necessary to help patients maintain good health.  While transparency regarding the cost of care is essential to empowering patients to make wise health decisions, the healthcare industry will see a weakening of the patient-physician relationship unless pricing data is consistently coupled with information on the quality of healthcare providers and facilities. Presenting the full picture of cost and quality to patients will allow them to discern which healthcare providers will be able to help them realize their long-term health goals.

Pamela J. Gallagher is a senior healthcare finance executive with 20 years of experience balancing the reality of finance with the delivery of excellent patient care. As a consultant she instills financial discipline, streamlines processes to maximize revenue, and reduces expenses for immediate improvements and long-term results.  She writes on healthcare, finance, and technology at gallaghersresulting.com.