Health care: You'd better shop around

Bob Braschler's search for cataract surgery was a real eye-opener. The Mayo Clinic wanted to charge him more than $20,000 for both eyes. Fairview Red Wing Medical Center quoted $18,000. Braschler finally settled on Minnesota Eye Consultants, which charged $10,000.

The baker from Red Wing, Minn., is just one example of how patients are shopping for medical care as they grapple with higher deductibles and co-insurance. A small but growing number of patients are calling multiple places to check prices before deciding where to go, something unheard of just a few years ago.

Hospitals are reacting in various ways. Most are adding staff to answer questions. They're trying to simplify pricing to make it less confusing. Some are even starting to drop prices to stay competitive.

It's no consumer revolution, but it may be the start of one.

Shopping for medical care "has grown and will continue to grow, as more of the burden of health care is put on consumers," said Doug Thorson, finance director at Children's Hospitals and Clinics of Minnesota.

Medical prices used to be trade secrets, jealously guarded by the hospitals and insurers that negotiated them. But with employers shifting more cost to employees, they have become everybody's business.

Price transparency

Now hospitals and insurers are tripping over one another to recite the new mantra of price transparency.

Park Nicollet Health Services cut prices across the board by 10 to 15 percent in the past four years, bringing them closer to the discounted rates insurers actually pay, Chief Financial Officer David Cooke said.

While just one of the four major insurers in Minnesota paid less as a result of the adjustment, it does mean that anyone checking Park Nicollet's website these days will find lower prices posted.

Similarly, Children's has reduced prices for MRI and CT scans by 10 to 30 percent after patients called to complain that they were finding lower prices elsewhere.

In addition, hospitals are looking for ways to untangle their Byzantine pricing, which is designed to make sense to insurers and not to patients.

Children's says that it plans to start charging a flat fee for common procedures such as tonsillectomies, instead of charging for time spent in the operating room.

The Twin Cities' biggest hospital group, Allina Hospitals and Clinics, is talking about bundling care for chronic conditions. For example, the hospital might offer one price for a year's worth of diabetic care.

For patients who have serious, expensive conditions, price is unlikely to be a big consideration. Most will continue to choose doctors based on reputation or quality, asking questions such as how many times a doctor has done a procedure. And for obvious reasons, shopping for health care has its natural limits.

"You don't want to start [treatment] and say, 'Oops, we found something else, Mr. Jones. Would you like to shop around?'" said Andy McCoy, vice president of revenue management at Fairview. "It's not like the brakes on your car."

Braschlers went shopping

Bob and Nancy Braschler own Braschler's Bakery and Coffee Shop in Red Wing, a pretty river town an hour's drive south of the Twin Cities.

Like many small-business owners, the Braschlers struggle to pay their health premiums, which have surged ahead of general inflation.

To keep premiums manageable, they opted for a high-deductible policy from Blue Cross and Blue Shield of Minnesota. It has a $637 monthly premium, with a $5,000 deductible. Last year, they opened a health savings account, which allows them to put aside pretax dollars for medical expenses.

The Braschlers have had few medical problems, but when they have, Nancy Braschler has been known to call hospitals to demand that they break down the charges.

"I like to know what I'm paying for," she said.

A 2005 Minnesota law required hospitals to make public their charges for the 50 most common medical procedures. In 2006, the state required the same of insurers, who have an incentive to steer patients to the cheapest providers, as that cuts their costs.

"Consumers are becoming more interested, particularly for things [priced] below their deductible," said Tina Frontera, senior director for cost and quality initiatives at Medica, a large Minnesota insurer.

Most queries tend to be for elective and lower-cost procedures, such as maternity services, lower-back procedures and MRI scans.

Insurers get significantly more phone queries and hits on their websites between October and December, when people are choosing their health plans for the next year, or using up what's left in their flexible spending accounts.

A HealthPartners software program called a medical cost calculator had 30,000 hits in 2006, with numbers peaking at the end of the year.

"Does it change where they go?" asked Scott Aebischer, senior vice president for customer services at HealthPartners. "We don't know that yet."

It did for Braschler, 64.

Several years ago, he noticed his eyes getting sensitive to bright light. He stopped going down to the river, a beloved activity for the family, living on a bluff overlooking the Mississippi. The sun's reflection off the water hurt his eyes.

An ophthalmologist in Red Wing diagnosed cataracts in both eyes.

Nancy Braschler called the Mayo Clinic in Rochester, which quoted a range of $10,800 to $11,800 for cataract removal, she recalled. "Then they said, per eye. I said, what?"

She called the local Fairview Hospital: $9,000 per eye. Then she called Minnesota Eye Consultants for a third quote: $5,000 to $6,000 per eye.

She called Fairview and Mayo back and found out the estimates included several thousand dollars in hospital fees. Minnesota Eye Consultants, with 12 branches around the Twin Cities, doesn't own a hospital.

Mayo and Fairview confirmed the estimates. Mayo doctors remove cataracts in a hospital rather than in an outpatient setting, saying it's safer for patients in case of complications, according to Mark Norby, who is secretary of the clinic's fee committee.

Mayo has seen a big jump in the number of people calling about prices, and "my sense is they are calling multiple places," Norby said. Mayo has adjusted prices downward slightly in recent years, he said.

Everybody saves

After talking to a friend who had the same procedure done at Minnesota Eye Consultants, Bob Braschler had surgery on one eye in mid-May and on the second eye in early June.

No matter where they had gone, the Braschlers were liable only for their $5,000 deductible. But that wasn't the point.

"I don't care if it's insurance or us," Nancy Braschler said. "We're all paying for it. If even 50 percent of people in Red Wing had it done for half the cost," she postulated, "think of the savings in health care costs!"

She says she' now may buy her Lipitor cholesterol-lowering drug from an online pharmacy. That pains her, she said, because she believes in supporting local merchants.

Chen May Yee is at • 612-673-7434

Chen May Yee • mychen@startribune.com