Why Medical Bills Are a Mystery – NYTimes.com

Interesting. In general, the private sector is better at understanding costs and applying rigorous costing as it plans and delivers products and services. Yet it does not appear to be the case in the largely private sector based hospitals in the U.S. (public hospitals also have imperfect cost information).

With accurate information on outcomes and costs, providers can improve care and save money by eliminating things that don’t help the patient, like multiple check-ins and medical histories, tests that provide little new information and long waiting times. Many routine tasks are performed today by highly trained doctors and nurses. These tasks can be shifted to others, freeing the most skilled clinicians for far more productive work.

Health care providers with expensive and poorly utilized equipment, space and staff can see the benefits of consolidating services to improve utilization and reduce some existing capacity. They can also perform routine services in lower-cost locations, reserving expensive medical centers for complex care.

These opportunities will allow the health care needs of an aging population to be met with little need to increase spending. Understanding costs could be the single most powerful lever to transform the value of health care.  This would give payers and providers the data they need to improve patient care, and to stop arbitrary cuts and counterproductive cost shifting.

As the saying goes, if you can’t measure it, you can’t manage it, and greater rigour in costing would help all – administrators, doctors, nurses and patients – reduce unnecessary procedures and duplication.

Why Medical Bills Are a Mystery – NYTimes.com.