Why Healthcare Needs Black Friday Sale

TThe best time to buy a car is at year-end sales, and Black Friday deals for major appliances can’t be beat. Have you ever wondered why you don’t see President’s Day discounts on colonoscopy? Or ads for free knee replacement?

In most cases, offering a discount on healthcare services to patients would be considered an improper incentive for the patient under federal law Civil Financial Penalties Law and the Anti-bribery law. These laws make cuts encouraging patients to seek unnecessary care and overuse services – as if anyone could schedule a colonoscopy for fun!

From cars to shoes, almost every industry uses discounts or financial incentives such as reward programs to attract customers. It benefits both the seller and the buyer. But if the hospital does so, it could face civil fines or criminal penalties. Law Specifically prohibited Incentives likely to influence an individual’s choice of a particular service provider.

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Insurance companies put these laws into their contracts with medical groups, hospitals, and other providers. Assigning or deducting a patient’s share of the cost could result in a breach of these contracts, as it could mean that the provider overpriced prices in the first place.

To be sure, laws are needed that require providers to prove that the services they provide are medically necessary, and many current laws do. If patients do not know or understand what care is recommended for them (and whether such care is necessary), there is a chance that fraud will occur – and it is. But with patients bearing more costs of care, current laws banning patient discounts are a blunt tool to address this problem and possibly bypass solutions to the growing problem of rising health care costs. Legalizing patient discounts could help give Americans some control over health care spending.

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The No Surprises Act attempted to address the problem. deep folded A condition that gives individuals the right to a good faith estimate before they receive medical care. By activating this requirement, the government recognized that consumers need pricing information to “comparison costs and decide which provider to seek care from”. The estimate should list the expected fees for all services and include the service provider’s “typical” discounted rates. But because providers cannot legally offer discounts or “sales,” “typical discounts” are the price that an insurance company or the rare cash-paying patient will charge.

So what does the consumer ultimately pay? In most cases, the provider’s “typical” discount rate will far exceed the patient’s co-pay or deductible, so patients likely won’t save money. But the intent — to help them save money by showing them a healthcare copy of the price tag, something they get on nearly every other purchase they make in their lifetime — is a good step forward.

I believe it is time to repeal the legal ban on patient discounts and enable healthcare providers and consumers to cut costs. With the opportunity to advertise lower out-of-pocket costs, providers can compete through pricing, not just quality and reputation. Service providers will also be able to improve their capabilities by offering seasonal discounts during slow periods or special rates for new services.

If these reduced rates are announced and known in advance, patients are more likely to pay up front rather than waiting for the insurance claim to be processed. Providers will get more revenue and patients will pay less—not to mention avoid the endless loop of calls about their bills. Insurance companies will also benefit from smart patients forcing providers to compete on price.

Public policy that prohibits service providers from competing for consumers on prices is inconsistent with the free market economy in the United States.

Government rules and insurance company policies have kept patients out of price negotiations for a long time. It’s time to change the rules to allow patients to demand more price competition in healthcare.

Stacey Bratcher is a general counsel for the health system in Santa Barbara, California.

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