Special on livers this week

Consumers would benefit from more information about the costs of medical care. For some procedures, patients can already get a predetermination of benefits. Dentists offer this service, so that their clients can get an idea of their options and decide what they can afford. But too often patients find out about the cost of their care only after they have received it. Patients--consumers in the health care system--do not always have easy access to the prices charged by all potential providers. Insurance companies cannot often tell their clients what certain procedures will cost until they have received all the bills from the doctors, hospitals and labs who have already done their work.

Moreover, medical professionals may be unwilling to disclose costs to potential clients at the outset for several reasons:

Some cases are complicated, and the ways patients respond to treatments are not always easily predicted. So costs will vary with medical attention over time. Some surgeries reveal unexpected problems or produce adverse effects for the doctors to manage.

Physicians, as well as other professionals, often want their practices to (seem to) operate above commercial considerations. Surely doctors are likely to resist a descent into the crass world of advertising: 'Hurry, while supplies last, let Dr. Moot do your liver'. Clearly, no one would benefit if doctors and patients negotiated for medical services the way dealers and prospective buyers haggle over the price of a used car. But the view held by many doctors and patients alike is that life and health, even if most of the time people are unwilling to put prices on them, and even if at some point they become too expensive to maintain, are nevertheless worth a great deal. So all parties tend to expect significant outlays for medical services.

Professionals who do not reveal their prices before they do their work have an economic advantage over the people they serve: customers have more difficulty complaining about charges after having received the services.

An unfortunate effect of the reluctance to make prices public is that customers cannot readily compare the costs of proposed treatments. More information for consumers in the market for health care will enable them to select less expensive treatments and providers, or deliberately choose to pay more for the services they want from providers with whom they are most satisfied. The cheapest or cheaper treatment is not necessarily the best; savvy consumers know that. Savvy shoppers also know that they cannot always afford the best or get exactly what they want for the money they have. So they often settle for getting the least expensive treatments from providers who meet minimum standards of competence.

Those who are not physicians are rarely qualified to diagnose diseases and treat illnesses and injuries. In any event, laws should continue to prevent non-professionals from practicing medicine. So laypeople do not bear much of the burden of determining who is a competent medical professional; they must rely on recommendations from trusted advisors or get assurances from the organizations that license or certify the professionals. Thus the public can be reasonably sure that, even if it selects the least expensive options for treatment, it will still get decent care.

Once they have determined to the best of their ability the qualifications of their doctors, patients can look at the charges for typical services. Given a diagnosis and recommendations for treatment, consumers ought to be able to make economic decisions about their providers and the proposed remedies.

Medical emergencies are special circumstances for users of the health care system: there is no time for someone needing immediate attention to determine the most cost-effective solutions to the problems. The patient may be unconscious, and even if conscious, the patient would not likely be impartial in a crisis, and so would be unable to perform a dispassionate economic analysis of the options available--the various ambulance services, hospitals, doctors and remedies. In these situations, the methods already in use would be more appropriate: treat the sick or injured with the quickest available resources, and let insurance companies or government programs try to keep the charges fair and assist with the necessary payments.

When patients can and do gather information and choose among various possible treatments and providers, they will probably get the best possible service at the best possible price. Making available more information about prices would generate additional competition among providers of healthcare. And this would in time help to control the costs of healthcare for everyone.