Is consumer-driven healthcare just a myth?

The notion of consumer-driven healthcare is predicated on the assumption that consumers, when forced to shoulder greater financial responsibility for their medical care, will be driven to use greater discernment and cost-awareness when seeking medical care.

Indeed, the American Enterprise Institute earlier this month puts the savvy healthcare consumer in center stage, according to the Los Angeles Times. The 10 conservative economists and healthcare analysts behind AEI's "Agenda for Reform" states, "U.S. healthcare would be far better, of higher quality and less burdensome in terms of costs if citizens, in their roles as patients and consumers of health services ... were ultimately in charge of making the important decisions."

However, at this time, there is no evidence indicating higher out-of-pocket costs will drive consumers to increase their degree of research and make more cost-sensitive healthcare decisions, according to the LA Times.

A December report from McKinsey and Company called "Debunking Common Myths About Healthcare Consumerism" states, "Five different surveys we conducted recently suggest that many, if not most, healthcare consumers are not yet making research-based decisions. Our findings indicate, for example, that only a few consumers are currently researching provider costs or even the number of providers they can choose among."

The idea of an "empowered consumer" operates based on three fundamental elements: price information on competing providers for similar services; reliable data on outcomes for any given medical treatment; and a population of consumers who are inclined to ground their healthcare decisions in the two aforementioned factors, according to the report.

However, comparative prices are still hard to locate, both in small regions with limited providers and big cities with high competition. Comparative outcomes are difficult for clinicians to determine, let alone the average consumer, and are often only determined after years of research, according to the report. Ultimately, most consumer healthcare decisions are made independent of cost and outcomes data.

At the same time, it is true that hiking up deductibles and co-pays has resulted in lower overall spending by consumers, though researchers haven't been able to pinpoint exactly why this is. Some hypothesize consumers crammed in as many treatments and procedures as possible before their higher deductible health plans kick in next year, or they have deferred treatments to avoid costs altogether. But many consumers don't know the difference between essential and nonessential treatments. For instance, many skip preventive services and reduce prescription drugs as a means of reducing costs. This can lead to higher overall spending in the long run.

"Simply calling a patient a consumer doesn't make buying healthcare like buying cars," healthcare economist Amitabh Chandra, PhD, of Harvard said recently in Forbes, according to the LA Times. "In healthcare, the consumer (i.e. the patient) is sick, tired, confused, distracted — they want their doctor or their insurer to help them manage the healthcare that they need."

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