Johns Hopkins Study: Hospital Gives Price-Transparency to Doctors—Costs Go Down

A press release from Johns Hopkins Medicine in April of 2013 describes a study done by research physicians, led by Dr. Leonard Feldman, where The Johns Hopkins Hospital actually provided the prices of tests to physicians at the time they ordered them.

The rest of the study was conducted as follows:

  • 62 blood tests were identified
  • 1/2 of the tests had prices displayed to physicians and 1/2 did not
  • Ordering practices were then reviewed for the next 6 months

The study found that costs went down by 9% for those tests where the prices were listed and went up by 6% where the prices were not listed.

The researchers found that doctors substituted lower cost tests—for example, they ordered a Basic Metabolic Panel instead of a Comprehensive Metabolic Panel.  I can tell you from personal experience, Comprehensive Metabolic panels seem to be WAY over ordered.  Doctors also ordered fewer tests—for example, Complete Blood Counts with a differential were simply ordered less often.  Again, in my opinion, differentials are also WAY over ordered.

There were no financial implications or incentives for the doctors to order lower cost tests.  The doctors were just shown the comparative pricing data.  It is reasonable to think that the physicians did not think about compromising the quality of patient care in an effort to lower costs.

I did my residency training in Internal Medicine at Johns Hopkins and from my experience there, if they thought the study was going to lower the quality of care, they would not have done it.  I am also biased though because I know Dr. Feldman and Dr. David Thiemann (cardiologist also involved in the study)—they are both great doctors and superb individuals.

Click here to read the full press release on the study.

What does this mean for the employee benefits professional and healthcare consumers?

  • Find providers that are innovating in the direction of improved patient VALUE like Johns Hopkins and steer employees to those providers.  If you are a large employer, I am sure the local hospital administrators would be happy to meet with you to describe their efforts – or – lack of efforts.
  • If you are a healthcare consumer, beware of too many blood draws.  Always ask the doctor what blood tests he or she is ordering and if they are really necessary.  Many blood tests are ordered out of habit—not for a good clinical reason.


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