Healthcare – Shopping for Smart Consumers

Turning healthcare consumers into healthcare shoppers is a great idea, except that healthcare shoppers aren’t very good … shoppers.

Confused healthcare shopperOne of the theories to improving healthcare efficiency is to offer more information, such as price and quality measures to patients (“consumers”). The logic is that, armed with this information, consumers will select the best quality service or provider, at the most reasonable price. Unfortunately, it doesn’t seem to work – or at least not very well.

Poor Shoppers

Recently reported in the New York Times, recent research has shown that even when information is provided to healthcare consumers, that few of them actually use the information provided. This may be due to many factors, including lack of understanding of the information provided, or a history of relying on doctors and other healthcare professionals.

Of course, part of the issue is that healthcare is enormously confusing. Adult consumers in the US and the UK – even those with advanced degrees, and excellent English proficiency – have a very difficult time understanding what is being said to them about their own bodies and ailments when the doctors and health professionals  insist on using Latin-laced descriptions and impossible to pronounce terms.

Will “Cheap” Work in Healthcare?

Over the past few years, there is a growing proportion of employees covered under High Deductible Health Plans (HDHPs) which have lower insurance premiums by offering increased out of pocket costs. Consumers are able to save a little month to month, by “risking” that they won’t need to spend the maximum out of pocket. This shifts the risk from the insurance plan to the covered individual or family (the consumer).  In theory, this risk shift should make these HDHP covered consumers more savvy customers. After all, the logic follows that if the bill has to be paid by the covered individual, and the charges aren’t masked or invisible because of insurance, then the consumers will be smarter, more careful purchasers.  Is this what has happened? In a word, “No.” In fact, there is evidence that “cheap” is seen as an obstacle in healthcare choice.