What she did
Jeanne Pinder created a company and launched a website designed to empower healthcare consumers by publishing the wildly varying prices of medical procedures and treatments. Based on the simple principle that “medical prices might be lower if they were more transparent”, ClearHealthCosts permits patients to comparison shop for services in a way that was previously impossible.
Jeanne Pinder founded ClearHealthCosts to try to correct what sounds like a simple problem: It’s almost impossible for a healthcare consumer to know beforehand how much a medical appointment or procedure will cost. That limitation often keeps people from seeking the healthcare they need.
The wildly divergent prices healthcare providers can charge came home to her when family members who had had minor surgery received their bills for anesthesia. Two anesthesiology bills were for $2,000—but the third was for $6,000. That $6,000 bill included a charge of $1,149 for an anti-nausea drug with an online price tag of $2.49.
Those anesthesiology charges made Pinder wonder: Could the inability to shop for prices be a reason why patients are charged wildly varying amounts for the same medical procedure? And could knowing prices in advance enable patients to seek lower-cost care and help reduce US healthcare spending, which outpaces that of other developed countries?
“What if every time you Googled for an MRI, you got drop downs telling you where to buy and for how much, the way you do when you Google for a laser printer?” Pinder said in a widely viewed TED talk.
Watch the video on TED.com
For most goods and services, sellers advertise prices to attract buyers. But in America’s convoluted healthcare system, prices are generally hidden from consumers and are often treated as proprietary information. Health insurance companies usually consider their contracts with hospitals and pharmaceutical distributors to be trade secrets that they will not release in advance.
Instead, patients with health insurance receive an “explanation of benefits” document after a doctor visit that shows the incurred charges, including what the medical facility would like to charge, the contractual charge negotiated by the insurance company, and the remaining charge or co-pay the patient is responsible for.
Pinder noted that the problem of high hidden costs is unique to the American healthcare system: “This is a US problem. In most of the rest of the developed world, sick people don’t have to worry about money [when they seek medical care].”
Pinder thought that if consumers had those prices upfront, it would put pressure on providers to lower costs for everyone.
That thought was on Pinder’s mind when, after working for almost 25 years as a New York Times reporter, editor, and executive, she volunteered for a buyout in 2009 because she was “looking for my next act.” She enrolled in a program on entrepreneurial journalism at the City University of New York; her idea for ClearHealthCosts won $20,000 in start-up funding in a Shark-Tank-type pitch contest and another $20,000 grant from the International Women’s Media Foundation.
The company began building its database simply by calling doctors’ offices and hospitals to ask what they would accept as cash payment for simple procedures. Many would not respond, and some were downright rude, but the researchers persisted. New York public radio station WNYC signed on as an early partner, asking women what they’d been billed for mammograms. Within three weeks, 400 women had responded.
From that start, ClearHealthCosts has grown into a nationwide service with interactive software that provides patients a platform to share their experiences. The website’s crowd-sourced data has highlighted huge price variations that include:
- An echocardiogram that cost $200 in Brooklyn was $2,150 in Manhattan
- In New Orleans, a simple blood test was $19 at one facility and $522 a few blocks away
- In the San Francisco area, the same MRI was $475 at one facility and $6,221 25 miles away
This information has led to some patients saving large amounts of money—and to some counterintuitive tips. For example, price transparency reveals that sometimes a patient can get a better deal by paying cash instead of going through an insurance company.
“A woman in New Orleans saved $3,786 by using our data. A San Francisco contributor saved $1,270 by putting away his insurance card and paying in cash,” Pinder said.
The prices—and important supporting information—are easy to find from the website’s homepage, where a “find prices” search tool invites the user to enter a procedure and a zip code. For example, if you select “ultrasound—abdomen” (procedure 76700) in zip code 70145 (New Orleans area), prices will pop up starting at $150 at East Jefferson General Hospital. That price was posted by a community member who said: “I have had my ultrasounds done at EJ for over 23 years. My insurance has changed and I have a $3,000 out of pocket so I paid cash to have my ultrasound done again at EJ.”
Another facility carries the notation: “Specialty doctors require $500 self-pay deposit at check-in; internal medicine, primary care and family doctors require $250 self-pay deposit at check-in.” Pinder adds, “So that is a good story [to know]. No poor people need apply.”
The highest ultrasound price was identified by a community member who went to an OB-GYN practice, where the walk-in price was $2,926 but the insurance price was very different. The patient’s insurance paid $517, leaving the patient’s share at $377.
The prices are color-coded according to whether the information was collected by ClearHealthCosts or its journalism partner, supplied by a community member, or supplied by the healthcare provider. There are also blanks noting healthcare providers that declined to reveal their prices over the phone.
The price finder covers 10 areas of the country in detail, and for zip codes not included in the covered areas, it provides Medicare prices as a benchmark. The homepage also includes a button to “share your prices” that enables visitors to the site to contribute to a “community-created guide to health costs.”
In addition to the pricing data, the website provides a wealth of other tips and information to support knowledgeable consumers. Some of its articles explain the healthcare system’s jargon, such as the billing code systems used by Medicare and hospitals for the vast number of procedure types. Other articles provide practical advice on how to save on prescription costs, how to dispute a bill, when it might be better to use insurance vs. pay cash, and a handbook on buying health insurance.
ClearHealthCosts has received grants from several foundations, including the John S. and James L. Knight Foundation, the International Women’s Media Foundation, and the Tow Center for Digital Journalism at Columbia University. Its primary source of funding, however, is through partnerships with local and national news outlets, including newspapers, public radio stations, and television stations. ClearHealthCosts supplies its journalism partners with expertise and software that lets them collect data for their area as well as publicize the project so community members can respond with crowd-sourced prices. It has had partnerships in San Francisco, Los Angeles, New Orleans, Tampa-St. Petersburg, Miami, Philadelphia, New York City, and four cities in Texas. It currently has a nationwide partnership with CBS News.
Pinder believes that the interactive engagement from these projects “changes a news organization’s relationship with their community.”
She has resisted implementing other potential revenue streams, such as charging consumers for access to the site or selling the users’ data. She said ClearHealthCosts approaches its business in keeping with its mission, goals, and values: “We live and do business in a way that is true to our principles, our integrity, and the ideals we stand for. We have had many opportunities to make trade-offs, to devalue that mission and those goals to make money, and we have consistently said no.”
The website has a broad target audience. It’s “anybody who uses healthcare. [From] our reporting, we can tell that our audience includes both insured people and uninsured people, those with high deductibles and low deductibles, cash patients, and every other kind of person. It’s not really based on affluence or lack of affluence: People want to know what stuff costs in health care, whether they are flush with cash or simply need an MRI to get back to work after a disability claim,” Pinder said. “We are also interested in reaching academics, journalists, lawmakers, and regulators.”
Pinder added that there is evidence that ClearHealthCosts is having an impact on policy.
In Louisiana, a pricing reform bill had languished in the state legislature for 10 years. The bill aimed to abolish surprise billing—a situation that may occur, for example, when a patient visits an in-network hospital, but is treated without being informed by a doctor who is out-of-network. As a result, the patient receives a large out-of-network bill that the insurance company refuses to cover. The Louisiana insurance commissioner had said publicly in early 2017 that he was finally giving up on getting the bill passed because of opposition from large insurance companies and hospitals. Shortly thereafter, ClearHealthCosts launched its Louisiana project in collaboration with local media partners.
“We were at the top of the evening news for a period of about two months. We were in NOLA.com/the Times-Picayune newspaper. People talked about us incessantly, we were everywhere,” Pinder said. “So we launched, and nine weeks later the bill passed by the convincing margin of 100 to 1.”
Pinder’s success has been recognized by her peers. ClearHealthCosts has won several journalism awards, including a national Edward R. Murrow Award, a national public service gold medal from the Society of Professional Journalists/Sigma Delta Chi, and a local Emmy.