Dan Weissmann
Economist Vivian Ho has been researching the U.S. well being care system for 4 many years. These days, she’s targeted on what she thinks are the most important burdens on the typical American: runaway hospital costs and rising medical health insurance premiums.
She has developed a technique for addressing excessive insurance coverage premiums — one which’s primarily based on giving sufferers dependable details about how a lot they, and their insurer, must pay for care. The system is already working in Massachusetts. Could it’s a mannequin for the remainder of the nation?
Ho explains to Dan Weissmann, host of “An Arm and a Leg,” why she thinks this method may assist curb excessive costs and the way listeners might help show it by sharing their medical payments.
Dan Weissmann
Host and producer of “An Arm and a Leg.” Previously, Dan was a employees reporter for Marketplace and Chicago’s WBEZ. His work additionally seems on “All Things Considered,” Marketplace, the BBC, “99 Percent Invisible,” and “Reveal,” from the Center for Investigative Reporting.
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Transcript: This Health Economist Wants Your Medical Bills
Note: “An Arm and a Leg” makes use of speech-recognition software program to generate transcripts, which can include errors. Please use the transcript as a device however verify the corresponding audio earlier than quoting the podcast.
Dan: Hey there–
Vivian Ho is a well being economist at Rice University and the Baylor College of Medicine in Houston. And since early 2024, she’s been giving talks at… HR conferences. Which isn’t a typical gig for an economist.
Vivian Ho: Um, sure. Economists don’t normally do this. We like to go speak at our personal conferences.
Dan: But she’s been desirous to unfold a fairly large message.
Vivian Ho: There’s a possible to avoid wasting staff, um, you realize, and staff some huge cash.
Dan: And a number of weeks in the past, she despatched me an electronic mail asking for assist with what she’s making an attempt to do:
She’s needs of us to ship her hospital payments for a examine she thinks may very well be a part of saving folks a number of moneys. She puzzled if I’d encourage folks to pitch in.
And truthfully, I needed to say sure earlier than I even actually knew something particular in regards to the examine.
I ought to say: Vivian Ho has been a donor to this present. That’s really how I met her and discovered about her work. And turned sort of a fan.
Over the previous couple of years, she’s been digging up and publishing proof we want, to push again in opposition to the best way well being care retains getting increasingly more costly.
This is stuff a number of us suspected, to say the least — stuff reporters have documented examples of — however she’s demonstrated they’re precise traits, not one-offs.
For occasion: When nonprofit hospitals make huge income — they usually typically do – they name them surpluses– they don’t usually use that cash to assist sufferers, by giving extra charity care to scale back folks’s payments.
In one examine, she in contrast hospital funds within the early 2010s and close to the tip of the last decade. As the last decade was ending, she discovered nonprofit hospitals have been a LOT extra worthwhile than they’d been earlier than.
And they’d gotten rather a lot richer, with like seventy % extra cash within the financial institution than they’d had earlier.
But they have been really giving out much less charity care.
She informed me she ran that down after she obtained assist understanding an enormous set of knowledge that helped her see what hospitals really do with their cash– and began to poke round in it.
Vivian Ho: I say, nicely, I’m simply gonna go take a look at, you realize, one of many native hospitals and see what it says after which I pull it up and I am going, oh wow.
Dan: She took a peek at one hospital’s “fund balance” — that’s non-profit converse for an establishment’s financial savings, like for a wet day.
Vivian Ho: The fund steadiness for one of many hospitals throughout the road from Rice University is 5 and a half billion {dollars}. And so, you realize, then it’s like, nicely, I have to take a better have a look at this.
Dan: Here’s a pair issues she discovered: That fund steadiness — the “rainy day fund” — was sufficient to run the hospital for greater than two years. And it runs a wholesome revenue margin.
And her examine confirmed when she zoomed out: This isn’t a one-off. Among hospitals that do nicely, it’s the norm.
And this sort of information — this sort of EVIDENCE of how issues work, of who advantages, and the way a lot, from the completely unfair and unaffordable costs we’re all up in opposition to — it’s ammunition.
Vivian Ho is in search of folks to share their hospital payments together with her, to be able to construct up her arsenal of knowledge .
She’s obtained a technique in thoughts for how you can deploy that data to avoid wasting lots of people a ton of cash. It’s attention-grabbing.
And: I don’t know if this particular technique will repay.
But right here’s what I do assume: ?If we’re going to combat in opposition to the greed and exploitation that make our well being care system so unhealthy — so lethal — we’re gonna want all of the preventing energy we will get.
So, I’ve despatched Vivian Ho a hospital invoice. And on the finish of this episode I’ll encourage you to do the identical.
This is An Arm and a Leg — a present about why well being care prices so freaking a lot, and what we will possibly do about it. I’m Dan Weissmann. I’m a reporter, and I like a problem. So the job we’ve chosen right here is to take one of the vital enraging, terrifying, miserable elements of American life, and produce you a present that’s entertaining, empowering and helpful.
Dan: Vivian Ho has been a well being economist for like 40 years. And you may say she has blended emotions.
Vivian Ho: Health economists, they work on so many alternative issues and they’re all essential and attention-grabbing. But I do assume the difficulty of the price of healthcare and the price of medical health insurance premiums is the most important drawback placing a burden on the typical American citizen. And I don’t assume as a occupation that we spend sufficient time on that fundamental problem. I really feel sort of – nicely, it does make me fairly unhappy as a result of right here I’m, I’ve labored on this profession for this whole time, and issues aren’t getting higher. They’re really getting a lot worse.
Dan: And that, she says, is why she does issues like go to HR conferences lately. She’s obtained the motivation and he or she’s obtained the liberty to do it.
Vivian Ho: So I’m tremendous fortunate. I’ve obtained tenure at Rice and you realize, I’m a member of National Academy of Medicine. I’ve kind of achieved every part that I needed to realize, and now it’s, it’s all about, nicely, what can we do?
Dan: She’s determined to go after what she now sees as the most important drawback. Not the ONLY drawback, however the greatest driver in costs that solely appear to go up extra yearly.
Hospital techniques are consolidating — gobbling one another up. So they get extra bargaining energy with insurers. They get greater costs with out essentially delivering extra worth.
Which isn’t what economists at all times count on. Bigger can imply higher, extra environment friendly. That’s what Vivian Ho used to count on.
Vivian Ho: I began this entire analysis agenda kind of 10-15 years in the past, and I assumed larger was going to be higher. I assumed due to economies of scale and that should you allowed hospitals to amass doctor practices, there could be much less duplication of companies, you’d get monetary savings. But then the issue is there’s no mechanism that forces a supplier to go any financial savings onto the buyer. So there could also be economies of scale, it’s simply you and I as shoppers aren’t capable of get pleasure from any of these advantages.
Dan: That’s one thing we’ve talked about on this present. Like rather a lot. But what Vivian Ho has been capable of reveal is: At this level, the typical revenue margins for hospitals — together with “non-profit” hospitals — are literally greater than common revenue margins for insurance coverage firms.
Vivian Ho: There’s loads of rural hospitals and smaller hospitals that lose cash, however internet, once you common on simply how a lot income the consolidated techniques are making and also you add them up all around the nation, it’s a lot greater than what you get for the whole income of insurers.
Dan: Which isn’t to say that insurance coverage firms don’t have a BIG position to play in our struggling.
Vivian Ho: Insurers are, in some ways, not doing what they need to be for patrons. Certainly the present demonstrates that in some ways and that they’re incomes excessive income. I’ve simply regarded on the information and concluded that the hospitals are incomes a lot greater income than the insurers are, and that’s the place we’ve gotta focus our consideration.
Dan: I imply, there’s a lot to unpack there, proper? One is, wow, the hospitals are incomes greater income than insurance coverage firms, and the insurance coverage firms, by and huge, are publicly traded entities that reply to shareholders. And the vast majority of hospitals within the United States are, so far as the IRS is anxious not-for-profit entities.
Vivian Ho: Exactly. We’ve been doing analysis currently that sadly exhibits that our not-for-profit hospitals behave rather a lot like for-profit firms.
Dan: So, okay, how will we get at that?
Vivian Ho: Oh, uh, how do we alter the habits of what’s happening?
Dan: Yeah.
Vivian Ho: Yeah. So…
Dan: Here’s Vivian Ho’s recreation plan. It’s difficult, and I’m not able to say, “this’ll totally work” — however there’s rather a lot that’s value figuring out right here.
Especially this:
When Vivian Ho talks to enterprise executives or HR managers, she brings out one other set of knowledge. And that is information that’s solely grow to be obtainable in the previous couple of years.
Insurers now have to point out what they pay hospitals. Not the sticker value, the negotiated value.
So, Vivian Ho’s speak features a slide exhibiting some particulars from three Houston hospitals. Blue Cross pays one in every of them about 22 thousand {dollars} for spinal fusion surgical procedure. Another one will get 66 thousand — 3 times as a lot..
And the slide exhibits: That math is comparable for different procedures.
Vivian Ho: Employers didn’t understand how completely different the costs may very well be at their native hospitals. They thought, you realize, anybody would assume, oh, the costs couldn’t be that completely different. And now that a number of the information is beginning to make it on the market, it’s changing into clear you actually may save some huge cash.
Dan: I imply, you MAYBE may — should you may give your staff a great cause to go to the hospital that expenses much less.
Vivian Ho has a mannequin for the way that would work. It’s — primarily based partly on a narrative I name Once Upon a Time in Massachusetts.
That’s subsequent.
This episode of An Arm and a Leg is produced in partnership with KFF Health News. They’re a nonprofit newsroom overlaying well being points in America. Their reporters do superb work. They win every kind of awards yearly. We’re honored to work with them.
So, right here’s our story — Once Upon a Time in Massachusetts — straight from the story’s writer.
Elena Prager: I’m Elena Prager. I’m an assistant professor of economics on the Simon Business School on the University of Rochester.
Dan: And whereas doing her dissertation, she got here throughout a really uncommon set of knowledge.
Elena Prager: I used to be like, wow, goldmine.
Dan: Here’s the story: Massachusetts has an company that mainly runs worker well being advantages for all state staff, and a number of local-government staff too.
And as soon as upon a time — beginning in 2010– they tried one thing uncommon.
Elena Prager: Possibly as a result of they have been fortunate, probably as a result of they have been sensible, they designed their medical health insurance plans – not less than when it got here to hospital care – primarily based every part on copays. And what which means is that you’re given a greenback quantity. Let’s say $250 or $500 and like that’s it. That’s the quantity. If you go to hospital A, you pay 250, you go to hospital B, you pay 500. The finish.
Dan: Which is completely completely different from how we’re used to taking a look at hospitals, proper? I imply, common insurance coverage usually say, “You’ll pay like 10 percent, or 20 percent or 30 percent of whatever the total bill turns out to be.”
Elena Prager: And the affected person is left scratching their head being like, nicely, how do I do know what the whole invoice is gonna be? Even if the hospital tells me one thing. Like, what if one thing goes fallacious with the anesthesia? They must name in an additional specialist. There’s a complication. More stuff will get achieved. Like it’s very, very arduous to, for a affected person and even actually a supplier, to foretell upfront what’s gonna be achieved to them and due to this fact what the worth goes to be.
Dan: So there’s no means for me to take value into consideration if I have to go to the hospital.
But Once Upon a Time in Massachusetts, there was. It was a co-pay. Whatever insurance coverage plan you have been on, it labored the identical means:
Go to hospital A — the place costs are usually greater — your copay may be 5 hundred {dollars}.
Go to hospital B — that expenses the insurance coverage plan much less for stuff — you’d pay two-fifty.
And Elena Prager discovered the info that confirmed what occurred subsequent.
Long story brief, she discovered that over three years, sufferers began utilizing lower-priced hospitals extra typically. Patients saved cash, and so did the well being plan.
And really, Massachusetts nonetheless runs its well being plans this manner, however–
Vivian Ho doesn’t assume different employers can simply get their insurance coverage firms to undertake this similar mannequin.
VIVIAN HO: It’s really a good quantity of labor.
DAN: Work for the insurance coverage firm. Doing the mathematics to determine which tier is which, and what the copays could be.
Vivian Ho: and naturally it will get the hospitals actually upset.
Dan: The of us in Massachusetts had a ton of leverage that the majority employers don’t have:
Elena Prager says they represented an enormous chunk of the insurance coverage market like a twelfth of it. Enough enterprise that it was value insurance coverage firms’ whereas to place within the work.
But now, Vivian Ho has her eye on a few new companies which are promising to do one thing related.
One is definitely a subsidiary of all people’s favourite insurance coverage firm: United Healthcare. They make an app known as Surest.
Surest Ad: It’s simple to buy a trip rental or your subsequent flight, however relating to one thing like healthcare, not really easy. That’s why Surest is a well being plan, designed to be easy with clear upfront prices.
Dan: Here’s how Vivian Ho describes the mechanics of this sort of app.
Vivian Ho: Doctor tells you you should go get an MRI, you punch an MRI, the app is aware of the place you reside, and it says, right here’s an inventory of suppliers the place you possibly can go get an MRI. And then should you go to this specific place, there’s no copay and there’s really no deductible, after which should you go to this MRI place, nicely, you realize, there’s gonna be a $25 copay or a $50 copay. Yeah. Isn’t that sort of thoughts blowing?
Dan: I inform her: That seems like I’d need that if I trusted that the place that prices my employer much less is, you realize, gonna take excellent care of me.
Vivian Ho: Right. Well that’s why I’m making an attempt to get funding to do an evaluation to have a look at the spending and high quality implications of utilizing one in every of these apps.
Dan: That is: Do folks utilizing these apps find yourself selecting lower-cost suppliers? AND: Do they get excellent care once they do?
Vivian Ho needs to review that. But first she wants to review one thing else.
Vivian Ho: All of those apps and value buying purposes, all of them rely upon having the right information. Now, the insurers are required to reveal this data by federal guidelines. It is slowly popping out. It’s not all there but, however nobody’s really regarded to see whether or not it’s correct.
Dan: Oh.
Vivian Ho: So there’s been a number of give attention to, is the worth there or is it not there, however not is it the worth that the affected person is definitely getting billed.
Dan: And this is the reason Vivian Ho needs our hospital payments.
Because: Whether or not one specific technique is gonna pan out, the info itself incorporates ammunition. One hospital will get paid twice as a lot as those throughout the road?
I imply, that’s data I would like out within the open, and getting put to make use of.
But that data can solely be helpful if we all know the info is correct. And proper now, there’s no solution to know.
Insurers are publishing huge information units, however how will we *know* any individual on the insurance coverage firm didn’t simply go to Chat GPT and say, “Make me a giant spreadsheet with these fields on it?”
Vivian Ho says if she has sufficient ACTUAL payments — a thousand could be good, three thousand could be nice — she will verify.
Actually, even higher: She needs your itemized invoice and, if she will get it, the paperwork you get out of your insurance coverage firm about what they paid. The factor that claims “This is not a bill.” It’s an “explanation of benefits” — or EOB for brief.
And, she acknowledges, this isn’t a TINY ask.
Vivian Ho: I understand it’s time consuming. It does, you realize, since you gotta sit down. It’s like, what’s my password and log in, and then you definately’ve gotta, you realize, discover one in every of these EOBs.
Dan: Oh, and also you’ve gotta cowl up all of your personally figuring out data.
Vivian Ho: We don’t wanna see your your identify and tackle and so, you realize, it takes time to you, you possibly can kind of print these out and use a Sharpie and cross them out.
Dan: It does sound like an enormous drag, however I’m right here to inform you: I did it. And it took me possibly 5 minutes.
I don’t know the way Vivian Ho’s particular technique will play out, and truthfully, neither does she.
Vivian Ho: You know, I’m going at this at kind of like many alternative angles.
Dan: Yeah.
Vivian Ho: So simply making an attempt to lift folks’s consciousness of there are enormous value variations. This is, that is what it takes to deal with the difficulty.
Dan: If you’ve gotten a hospital invoice within the final 12 months or so, and also you’ve obtained 5 minutes — possibly set a word in your calendar for once you DO have 5 minutes? — I’d find it irresistible should you gave this a shot.
Grab a sharpie, fireplace up your printer, dig up your login. Print out a invoice and an EOB, scratch out your figuring out data, take an image in your telephone — wow, that is sounding lengthy, however truthfully, it took me 5 minutes — so do these issues, and ship the photographs to [email protected].
Vivian Ho’s obtained researchers standing by.
Coming up on this present: We’re gonna take a while because the 12 months ends, to have a look at some issues that DIDN’T suck in 2025.
Which mainly means: Places the place state governments stepped in to guard us from ripoff costs. Which, it seems, occurred!
News archive 1: Oregonians burdened by medical payments might quickly get a break on their credit score scores.
News archive 2: New regulation aimed toward defending Maine shoppers from the impacts of medical debt goes into impact.
News archive 3: Tonight Indiana governor Mike Braun indicators 10 well being care-related payments into regulation.
Dan: Happened sufficient that it’ll take greater than only one episode to offer you a great pattern.
That’s subsequent time on An Arm and a Leg.
Till then, maintain your self.
This episode of An Arm and a Leg was produced by me, Dan Weissmann, with assist from Emily Pisacreta — and edited by Ellen Weiss. Adam Raymonda is our audio wizard.
Our music is by Dave Weiner and Blue Dot Sessions. Bea Bosco is our consulting director of operations.
An Arm and a Leg is produced in partnership with KFF Health News. That’s a nationwide newsroom producing in-depth journalism about well being points in America and a core program at KFF, an unbiased supply of well being coverage analysis, polling, and journalism.
Zach Dyer is senior audio producer at KFF Health News. He’s editorial liaison to this present.
An Arm and a Leg is distributed by KUOW, Seattle’s NPR information station.
And due to the Institute for Nonprofit News for serving as our fiscal sponsor.
They enable us to just accept tax-exempt donations. You can be taught extra about INN at INN.org.
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“An Arm and a Leg” is a co-production of KFF Health News and Public Road Productions.
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