3. Speaking the Same language : Health Care Cost Terms

Remember when Ms. Jones asked her doctor what the stress test from her cardiologist was likely to cost, and he could only shrug and say he wasn’t sure? This may have seemed like a brush off, and certainly left Ms. Jones feeling frustrated and unsatisfied, but in reality it can be very difficult for a provider to know or even estimate the costs of service. The costs of delivering health care in America are often obscured behind layers of jargon and complex accounting methods, and are often different based on each individual patient.

Notable health economist Uwe Reinhardt famously referred to pricing in US hospitals as “chaos behind a veil of secrecy.”1 While pushes toward transparency exist, there is still wild and unexplained variation in pricing between institutions, cities in the same state, and between states, and there is no universal willingness to share pricing data.²

Beyond this variation, the relationship between “cost” and “price” in health care is often not clear, and the definitions of each vary based on perspective. The addition of various payers (insurance companies) and differing coverage depending on the patient further complicates the equation. The portion that patients will be required to pay and the answer to the question, “How much is this going to cost me, doc?” is thus very difficult for physicians to answer or even predict.

Recent media coverage and the development of websites and tools providing information directly to patients about potential health care charges have led to a national movement towards price transparency. And while physicians may not be expected to know the ins and outs of all potential costs to patients, they still have an ethical obligation to help patients navigate the substantial barriers and financial “side-effects” of their care.