There have been a few articles lately that claim cost transparency tools to shop for health care aren’t as helpful to patients as payers and providers originally hoped. And yes, it’s true, customers aren’t yet shopping for medical procedures the way they shop for clothes, searching for the lowest price at all times. But here’s the surprising thing we discovered when we analyzed more than 40 million searches conducted by 19.5 million patients over a 19-month period on Rally Connect: People use cost transparency tools to shop for people, not procedures.
Basically, consumers first use search tools to find a doctor who fits their needs and accepts their insurance. Only after consumers have found a doctor do they begin comparing costs for visits and procedures.
Rally Connect ® is a robust web and mobile search tool that lets people easily find doctors, hospitals, and other care providers, drilling down into results based on clinical quality, price, and star ratings. Users can also see which doctors accept their insurance, along with the actual copays and deductibles it would cost them to see a particular provider. (Users who download our companion Rally Care (™) app will even have their insurance ID card right there on their phone.) We analyze millions of searches and preferences on Rally Connect to optimize the experiences we provide to payers and providers, and their patients.
Before we dive into the data, let’s put an end to the idea that people aren’t shopping for health care. Some 32 percent of people now shop for health care online or via mobile apps, just as many who shop for vacations and cars, according to a 2017 UHC consumer sentiment survey. Our own data aligns with these findings; 44 percent of people who engage with Rally Connect as they search for care also get cost estimates. So, people are absolutely comparing prices for health care, but it’s part of an overall process of looking for doctors.
Based on our experience, when patients need a treatment they start by looking for a primary care doctor or specialist. Then they want to see the costs associated with these doctors, rather than the specific treatment they need. That part comes later.
This finding is important for payers and providers interested in improving their patient satisfaction scores. Connect someone with a highly rated, available, local doctor within their health plan, follow that up with easy-to-access information about procedure prices, and you’ll most likely have satisfied customers.
Other interesting findings from our research include the fact that the majority of people searching for prices have high-deductible insurance plans, which makes sense as these patients have more out-of-pocket expenses than those with top-tier plans with low deductibles.
About 64 percent of users who got a personalized estimate based on their insurance information had an average deductible of $1,295. Not surprisingly, non-covered procedures, such as cosmetic surgery, had higher estimated costs than covered services. The median estimate for procedures covered by insurance was $4,974, while the median for non-covered procedures was $7,000. Patients searched for covered medical services eight times more often than they did for cosmetic services, however, showing that most patients are concerned with pricing routine medical procedures, not getting estimates for elective services.
As the number of Rally Connect patients with high deductibles grows beyond the 39 percent industry-wide figure today, we suspect that the median estimate for medical services will increase from these baseline figures, since the bulk of our users are already coming from high- deductible plans. In other words, as more people have to pay more for their care, the more costs will matter, and the more important cost comparison tools will be.
Bottom line: Whether they have platinum-level insurance or a basic high-deductible plan, people are shopping for health care. However, patients are first and foremost interested in finding a great doctor, opting to compare prices for procedures only after they’ve found a doctor. The human touch still rules in medicine.
Next: How People Search When They Search for Health Care
Karl Ulfers is senior vice president of product at Rally Health. For more on cost estimation tools for hospitals and other health care providers please contact rallysales@rallyhealth.com.
