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Earlier, we had noted how the state of Massachusetts requires that health care providers make pricing information available to inquiring consumers. It appears that the legislation did not specify any consequences, and perhaps not surprisingly, people are still having difficulty procuring pricing information. Interestingly, the difficulty differed by specialty.

The president of the Massachusetts Medical Society seems to defend doctors' offices by saying that prices are complicated because different insurers have negotiated different rates. The problem with that line? Doctors' offices didn't even know the price that would be charged to patients who would pay without insurance.

Sadly, the health insurance companies also fared poorly in a review of their tools for online healthcare shopping. Still, the legislation is a step in the right direction, and hopefully, more of the industry will adjust as increasing numbers of patients ask for this information.

With the passage of the Affordable Care Act, providers who were terminated with cause from one state's Medicaid program are now no longer eligible to participate in another state's Medicaid program. This measure was supposed to reduce fraud by providers who would get caught in one state and simply set up shop in a different state. That's the theory at least.

Reuters and the U.S. Department of Health and Human Services Office of the Inspector General both conducted independent studies and found contrary to that. The Office of the Inspector General recommended that the government work to standardize terminology used by different databases so that each state can more easily detect when a provider is no longer eligible.

On one level, I sympathize with the problems of standardizing data across different sources. We at DocSpot deal with that problem frequently. On another level, though, the Department of Health and Human Services was the organization that put forth the National Provider Identifier system for the purpose of uniquely identifying providers across multiple contexts. They had to do a fair amount of work for that project, and it seems that they could have done a better job of standardizing termination terminology upfront in order to comply with legislation and reduce millions of dollars paid out in fraud.

One of the centerpieces of the Affordable Care Act was to create health insurance exchanges for each state. More than that, the health insurance exchanges required the insurance plans to be grouped into different tiers (e.g. Bronze, Gold) so that consumers could more easily compare their options. When experiencing a simplified the selection process, some consumers probably ended up selecting less expensive plans than they would have otherwise since they could feel more confident that they were indeed selecting a comparable package. That's the theory at least. A related theory is that competitive marketplaces (exchanges that offered more plans) should experience lesser price increases. On this theory, the Department of Health and Human Services (HHS) has released some preliminary data that substantiates this point.

In an issue brief, HHS released data indicating that the counties with a net increase in the number of insurers experienced a 2% price reduction for the benchmark plan, where as counties with a net decrease of insurers experienced a 12% increase in the benchmark price. HHS did not release enough data for us to be sure that the two numbers (number of insurers and price of benchmark premium) are related. For example, there might be confounding variables. Also, the benchmark premium is defined as the second lowest cost silver plan, which is somewhat awkward since insurers might be able to reduce costs by altering other aspects of the plan that are not easily comparable (such as narrowing the network of providers that accept the plan). These concerns are slightly alleviated by looking at the weighted enrollment (e.g. if a plan is terrible, fewer people will enroll in it even though it's cheaper), and there, the gap between the two different categories of counties was much smaller (1% increase vs. 4% increase), but still supports the overall theory.

Overall, the numbers do suggest that increased competition does actually lead to lower prices. The issue brief also notes that most counties did see an increase in the number of insurers, which is also positive for the consumer (even if the prices were not affected). On those notes, the health insurance exchanges seem to be functioning as designed: facilitating competition to drive down premiums.

Last week, I commented on ProPublica's release of their Surgeon Scorecard tool. Consumers' Checkbook also released its Surgeon Ratings tool, garnering much less attention. Their tool is friendlier towards the provider community in that they suppress listings for surgeons who appear to perform poorly. They also suppress information on surgeons for whom there are too few data points, so a surgeon might not be listed for either reason. We think that both of these tools are steps in the right direction.

Perhaps not surprisingly, the American College of Surgeons (ACS) chimed in with their own statement, offering a dismal view of these tools. Their critique echoes the criticism of others, faulting the tools, for example, for not relying on clinical data. This criticism is a convenient excuse in that at one level, everyone understands that using clinical data to assess clinical outcomes is better than billing data. On the other hand, people also know that the release of clinical data for public reporting purposes is very far away.

The ACS ends its statement with a warm and fuzzy sentiment: "At its core, the American College of Surgeons is committed to improving the care of the surgical patient and believes that sharing meaningful data is key to that endeavor. Let's do it right and together." It so happens that the ACS has been collecting clinical performance information about surgeons (via a program called NSQIP). ACS's platitudes and objections to these billing-based surgeon rating tools ring hollow unless we see it work towards the public disclosure of the metrics that it has developed. Two straightforward steps that ACS could take today are to make it easy for individual surgeons to agree to publicly disclose their metrics via ACS and for ACS to make a public statement encouraging surgeons to do so.

Until the medical community truly engages with the issue of quality variation across providers, it is my hope that these imperfect tools based on billing data will prod the industry into further deliberation and eventual release of metrics based on clinical data. Let perfection not be the enemy of progress.

This past week saw the release of Propublica's Surgeon Scorecard. This is a tremendous milestone in terms of unveiling information that prospective patients can use to make more informed decisions when selecting a provider. Information about clinical quality has been difficult to come by, and Propublica has meaningfully pushed the boundary forward.

The overall reaction seems to be fairly positive. Granted, because Propublica relied on billing data from Medicare and because they limited the procedures of interest to specific elective surgeries, the number of surgeons identified in the database is less than 17,000. Some from the medical community have also taken issue with their methodology. The medical industry has had years (if not decades) to take the lead in releasing meaningful quality information to help patients decide. They have chosen to abdicate what was naturally in their domain, so criticism from them about this project mostly rings hollow. It's not that we think that the Surgeon Scorecard is perfect -- rather, we think that it's a significant step forward in an area that was otherwise relatively stagnant.

We applaud Propublica's effort and hope they continue to push the boundaries in acquiring broad data sets and applying thoughtful analysis to them to help patients select providers.