Transparency Is the Cure for High Hospital Prices

If you are tiring of the green energy revolution and can’t quite get on board with the mission to Mars, yet still would like to join a worthy cause with the potential to transform millions of lives, allow me to make a recommendation: transparent hospital pricing. It may sound less ambitious than big spaceships, but in a services-oriented economy, it is at least as important.

It is hard to get a straight answer about prices for medical procedures in the US, unlike in much of the rest of the world. The US also has some of the world’s highest health-care costs, in part due to insufficient competition.

Greater price transparency doesn’t have to cost much money upfront, as most of what is required is attention. A critical majority of Americans — including doctors, patients, politicians, media and hospital board members — needs to insist on this outcome.

And I do mean insist. Just as, at some point, a critical mass of Americans demanded that the US end the Vietnam War. Otherwise, change is very unlikely to happen.

Some parts of the Affordable Care Act provided for transparent hospital pricing of individual services, and further regulations took effect in 2021. These were steps forward, yet the law has not turned the tide. It does not price packages of services, and it does not make it easy to compare one provider to another.

Recent research shows it is hard to even get a single consistent answer from a single provider. For instance, prices posted online and prices quoted over the telephone do not correlate very closely. For 41% of hospitals, the price difference was 50% or more. Clearly, suppliers aren’t really trying.