Connecting Physicians to Health Care Cost Transparency

teaching_values_projectBy François de Brantes, MS, MBA and Neel Shah, MD, MPP

We recently returned from the National Summit on Healthcare Price, Cost, and Quality Transparency, where leading thinkers convened to discuss next steps in a growing movement to hold caregivers accountable for delivering better care at lower costs. Traditionally quality, cost, and patient experiences remained locked inside black boxes of individual patient–physician encounters. However, at the cusp of 2014, the window of opportunity to shine a light on physician performance appears to be permanently jammed open by public demand, payer pressure, and a technology marketplace that is eager and capable of making it happen. The summit message was clear: Our early efforts to measure and report physician performance data are imperfect and need continued tinkering, but they are here to stay. We would like to take a moment to describe what this means for individual physicians and those who are interested in bringing them along.

Spotlights are uncomfortable, unless you are a stage performer. Or a physician, honestly. Physicians are inherently competitive and like to shine, as long as they have a reasonable opportunity to perform well. The first step to enabling this is to parse the pieces of the value equation that individual physicians can affect directly. Many transparency efforts described at the Summit are aimed at revealing arbitrary variation in consumer prices. This is important to uncover, but in bringing physicians along, we must remember that physicians don’t set prices from the bedside.

Physicians do, however, determine utilization—which varies equally arbitrarily and is a significant contributor to wasteful spending —as well as referrals, which have an increasing impact on consumers’ wallets. Professional movements such as the ABIM Foundation’s Choosing Wisely campaign have started to assert guidelines on frequently overused tests. Physicians can and should be accountable to these, allowing for reasonable exceptions to every rule. On the other hand, widespread availability of prices on referred services remains elusive for most physicians, potentially putting them at odds with their patients’ financial interests.

As a result, we must create the right incentives to reward success. Patients are at financial risk for much of the total cost of care, and the incentives that drive their need for cost information might soon overwhelm their natural desire for quality information. To correct that imbalance, physicians might soon find themselves in a changed role that makes them not simply the stewards of their patients’ care, but also the stewards of their patients’ out-of-pocket expenses. To an extent, payment innovation, including bundled payments and total costs of care formulas, are engaging physicians in that dual role. Physicians engaged today in these programs are looking closely at the price of durable medical equipment, post-acute care, facilities, and ancillary services; and are making value-based decisions. That’s good for the patient, for the physician, and for those paying the medical bills.

As the industry transforms, the best sign of success will be the reduction in much of the variation that we observe today: the unjustifiable variability in prices, and the unjustifiable variability in utilization. And that simply won’t happen unless physicians embrace this dual steward role. We think they will, because it appeals to their naturally high sense of professionalism.

Francois de Brantes is executive director of the Health Care Incentives Improvement Institute (HCI3), which manages the Bridges to Excellence and PROMETHEUS payment model, in Newton, Connecticut. He attended the University of Paris IX – Dauphine where he earned an MS in economics and finance. After completing his military service as a platoon leader in a Light Cavalry Regiment, he attended the Tuck School of Business Administration at Dartmouth College, where he graduated with an MBA.

Neel Shah, MD, is executive director of Costs of Care, an independent nonprofit that helps patients and their caregivers deflate medical bills. He is also an ob/gyn based at Beth Israel Deaconess Medical Center and an investigator at Ariadne Labs. His Wing of Zock column, the Teaching Value Project, appears monthly. He can be reached at