Executive Order Requires Providers To Disclose Prices
President Bush on Tuesday signed an executive order that requires HHS, the Department of Defense, the Department of Veterans Affairs and the Office of Personnel Management to collect more information about the quality and cost of health care they provide and to share that data with one another and with beneficiaries, the Washington Post reports (Fletcher, Washington Post, 8/23). The order directs the agencies to work with the private sector and other government agencies to develop and enact programs to measure quality of care.
The agencies will work to identify practices that promote high-quality care. In addition, the order calls for the agencies to use interoperable electronic health records where available, and it requires the agencies to compile information on the prices they pay for common services.
The agencies must have the new programs in operation by Jan. 1, 2007 (California Healthline, 8/22).
The order does not detail how health care providers would pay for increased costs related to establishing and meeting data-sharing standards or how providers would show charges for specific services, the Los Angeles Times reports (Gerstenzang, Los Angeles Times, 8/23). The Wall Street Journal reports that "[m]uch remains to be seen" on how the order is enacted "because different interest groups want different standards" (Zhang, Wall Street Journal, 8/23).
Bush said the executive order sends a message to health care providers that "in order to do business with the federal government, you've got to show us your prices" (Los Angeles Times, 8/23). "The fact is, if you have excellent information about quality, about service and about price, people make good decisions," Bush said.
During a business roundtable with medical and business executives in Minnesota, Bush also promoted health savings accounts and association health plans. At the roundtable, Bush said, "I guess if I had to summarize how I view it, I would say there's a choice between having the government make decisions or consumers make decisions. ... Health care policy ought to be aimed at bolstering the consumer, empowering individuals to be responsible for health care decisions -- is kind of the crux about what we're talking about" (Washington Post, 8/23).
HHS Secretary Mike Leavitt said that the order will allow the federal government, which pays for up to 40% of all U.S. health care, to use its purchasing power to push for changes in the health care system (AP/Long Island Newsday, 8/23).
Leavitt, speaking to reporters on Air Force One, said, "The reality is, very few people have a clue what their health treatments cost. And even fewer understand the quality that they're receiving as it relates to other alternatives. The consequence of that is that you have a system where, essentially, there are no limits, and no one has an idea of what it's costing" (Crowley, CQ Today, 8/22).
Karen Ignagni, president of America's Health Insurance Plans, said the order "rewards the delivery of high-quality care, fosters an interoperable health care system and takes steps to ensure that consumers are equipped with the best available information they need to make health care decisions" (Los Angeles Times, 8/23).
John Engler, president of the National Association of Manufacturers, said, "Greater transparency of cost and performance information will help consumers make more informed decisions regarding their health care. Additionally, adoption of health IT standards will further improve health care quality, streamline inefficient processes and reduce costs that are burdening our businesses."
Rep. Patrick Kennedy (D-R.I.) said he supported the order. "The government buys so much health care that, if the various agencies coordinate their efforts to drive quality and efficiency, it can make a huge difference," Kennedy said. He added that "patient privacy must be a paramount concern" (CQ Today, 8/22).
Edward Langston, a board member of the American Medical Association, said pressuring doctors to be more transparent about their prices might not be effective because most health care consumers pay doctors through the government, insurers or other third parties, which set the prices (Wall Street Journal, 8/23).
PBS' "Nightly Business Report" on Tuesday reported on Bush's signing of the measure. The segment includes comments from Robert Berenson, health policy fellow at the Urban Institute; Bush; and William Fried, medical director for Aetna (Dhue, "Nightly Business Report," PBS, 8/22).
The complete transcript is available online.