The dirty little secret of private healthcare pricing


Pricing secrets allow costs to be artificially inflated. Pubic information on the costs of delivering tests, hospital admissions and treatments would expose excessive profit margins and allow consumers to demand lower costs and a farer business transaction. This would cause private health prices to drop. And while that would be great for patients, it would be terrible for private hospital CEO’s, drug companies and their investors. A lot of very powerful people have financial interests in private health care services. And while a few might complain in public about ‘private surgeons’ in private, few want to talk about the millions being made from healthcare secrets and profiteering.
The daily Mirror in England recently published a list of politicians found to have financial links with the private companies bidding for National Health Service contacts. Can you imagine the Australian Herald Sun or Daily Telegraph being brave enough to publish this kind of a list?
Try comparing shopping for private medical treatments to shopping in a supermarket, and you will instantly see the difference in the consumer’s experience. Secrecy, obscurity, blockages and delays are the norm for private patients.

How does this secrecy affect doctors? Here is American doctor David Belk’s first video in a fascinating series, talking honestly about how little doctors know about how much they actually get paid.

The secrecy of how Medicare funds are spend by doctors in America and Australia shows the destructive power of secrets. The Wall Street Journal reports that the Medicare claims database, a record of how Medicare is spent by American doctors is kept hidden from the public. The reason? A law suit by the American Medical Association thirty years ago to prevent public access to the information. The way billions of tax payers money is being spent is able to be kept hidden because of the power of one professional lobby group.
One of the most devastating impacts of healthcare secrecy is the rise of over servicing, fraud and waste that currently plagues privatised healthcare systems. It is currently estimated that 1/3 of healthcare spending in the US is of no value to the patient. Imagine finding out that 30% – 40% of healthcare spending in Australia was unnecessary? The ‘money saved’ by charging patients five or seven dollars for a GP visit is small change. Why bother? Unless it’s a red herring for the radio shock jocks and mainstream media, while the rich continue rorting tax payers money by the billion?
Since 1960 USA spending on healthcare has risen by an increase of 818%. By comparison the GDP has risen during the same time by 168%. And wages have risen by 16%. As David Belk explains ‘unlike any other business in America, almost all of the financial transactions in healthcare are hidden from the providers as well as the patients’.
Many doctors in the US and other countries are struggling for more transparency. But it’s a long hard road to travel.
Here is a TedMed talk by Leona Wen an American doctors, about how doctors should be honest about their financial and business relationships that may affect patient care. Her campaign for openness about medical business dealings earned her death threats.

All those interested in the future of Australia’s health system should start following Elisabeth Rosenthal’s astonishing Facebook page Paying till it hurts. She reports a million dollar bill was recently given to a young family, when the Canadian mother gave birth to a child nine weeks before term, while on holiday in Hawaii. Her insurance fund refused to pay, claiming her unreported urinary tract infection and spotting early in the pregnancy showed she had a ‘pre existing condition’. Does the Australian Liberal Party which states that private health insurance is in their blood, have anything to say about the relationship between secrecy of heath prices and blatant price gouging and profiteering? Or that Australia’s skyrocketing privatisation of hospital beds has led to us having the third highest out of pocket medical bills in the OECD?
The results of the 2014 Senate Enquiry into out of pocket costs are now available. It reported that health care costs are the Commonwealth’s largest single long term challenge. That the government should not continue with further co payments. And that the government review both the Pharmaceutical Benefits Scheme and existing models of funding, to find ways to cut waste and increase efficiencies. The Liberal response? Silence.
In America, Obama’s drive for greater transparency led to the release of a report, showing the cost of 100 of the most commonly performed medical procedures, at different hospitals across the country. The result showed a bewildering system riddled with staggering cost differences.

By now it must be clear why Wikihospitals was inspired by Wikileaks and Wikipedia.
2015 may bring to life a long held dream to deliver accurate, targeted information on healthcare pricing and quality, via a phone app using Big Data. Think it’s not possible to crunch that much data? Watch Dr Watson in action. And keep reading this blog.

Wikihospitals 2014.