GAO’s Findings on HHS Transparency Efforts

Submitted by on Sunday, November 23, 2014 - 08:42

HHS response to a new GAO report on the Department's efforts to improve price transparency:
"For the Compare websites, HHS has focused on performance [quality] information, as Medicare payments are set based on a fee schedule or prospectively determined amounts, resulting in minimal price variation in a specific geographical location".

And no, it's not a joke, it's real. That is HHS' official response to a GAO report that appropriately criticizes the Department and its main Agency, CMS, for failing to provide any meaningful pricing information to the millions of Medicare beneficiaries that might benefit from it. The official HHS excuse implies that it would be silly to provide transparent pricing information for common elective procedures to Medicare benes because Medicare prices don't vary in a given region. There is, of course, another reason for the lack of pricing transparency and one can find it in the perceptive observation by the GAO: namely that Medicare's policies on quality transparency have been guided by a strong desire to avoid any conflict with providers, whether hospitals or physicians. As such, the GAO observes, the web interface of Hospital Compare for comparing the quality of hospitals is purposefully difficult and runs counter to most of the best practices in such tools. In other words, it's not incompetence, but rather planned. That makes it a lot worse.

What this means to you – Recent releases of "cost" data by CMS, including charges, spearheaded by Niall Brennan, who has just been named Big Data Guru, have been a step in the right direction, even if a baby step. This GAO report reveals that these baby steps have been small because the agency has made a conscious policy decision to favor the interests of the providers over those of consumers. While the price of an individual service doesn't vary from provider to provider within a geographic area, the price of a common elective procedure – as understood by lay consumers to mean a medical episode of care such as the placement of a stent or the replacement of a joint – varies significantly. It varies so significantly that CMMI has launched several payment reform pilots to reduce that variability. In the past couple of years HCI3 has published reports that clearly indicate the variability of medical episodes within a specific Hospital Referral Region and between regions. Therefore, for HHS to use these "weasel words" (as Bruce Bradley was fond of saying) is disingenuous and insults the intelligence of Americans. Of course, that's nothing new from an "intelligentsia" class that consistently sneers at the American public. The bottom line here is quite simple and the report reveals it. CMS could display useful and consumer-friendly price and quality information on providers that would help Medicare beneficiaries, and perhaps other Americans, to better distinguish the value delivered by providers. It has made the decision not to, and no one should tolerate that. Perhaps some of the members of the new Congress won't.