Web site offers list of "average" costs of care

Healthgrades.com, long in the business of attaching quality ratings to hospitals and physicians, is moving into the business of disseminating what those hospitals and physicians charge.

For $7.95, a patient may download a report stating the cost of 55 hospital-based procedures, from aortic aneurysm repair to vasectomy. The Golden, Colo.-based company said it expects to add 200 individual tests and office visits to the database.

The patient would enter his or her age, gender, location, and insurance co-payment and deductibles. The report would give the average cost of the procedure, by region, for the patient, broken down by the insurer's share and the patient's share.

Unlike reports health plans are beginning to generate, the information is not broken down by individual facility. Instead, Healthgrades.com imagines consumers taking the information on the report and comparing it with what they're being charged by an individual physician, hospital and insurer.

"It's trying to set up a price list to help patients purchase and negotiate for care," said Healthgrades.com executive vice president Sarah Loughran. "There is a market in which consumers buy based on cost and quality." Loughran said the per-report fee was accessed to cover the cost of assembling a nationwide database of more than 55 health plans over a two-year period. The Web site is also available on a subscription basis to 100 companies, whose employees can access the information for free.

While physicians and medical industry experts generally support the idea of having prices posted for patients, they said Healthgrades.com, as with other efforts, has a long way to go. In particular, they worry about price information not being taken in context with the quality of care.

"Although we support the idea of providing as much information to the consumer as possible, the idea of looking at the cost of procedures without corresponding data on quality and outcomes is a disservice to our patients," said Colorado Medical Society President Richard May, MD.

David L. Richardson, MD, a radiation oncologist in Denver, said he sees nothing wrong with patients doing "a little comparison shopping." But he said patients should trust a physician's recommendation for a course of treatment over a Web site's suggested cost estimates.

"One shouldn't really be concerned about the dollar amount," Dr. Richardson said. "One should seek the advice of their doctor and go ahead and have the treatment that is recommended for his [or her] condition regardless of what the cost is."

Glenn Melnick, a health care financing expert with RAND, said someone with insurance likely wouldn't use the site, because that person might not be as concerned about how much a procedure costs if insurance is expected to pick up most of the tab. But self-pay patients might find the Web site valuable, as might patients in high-deductible plans linked with a health savings account.

"In its current shape, [Healthgrades.com's reports] will have limited impact on the market," Melnick said. "What this reflects is a first step in providing quality and price in the same place. Let's hope we're going to see a product that's available for a wider selection of people."