Practical Barriers Obstruct Patient Price Shopping

Patients are likely to follow referrals made by their physicians even if they have sufficient information to make a choice between providers based on price, according to a new study by published in the Journal of Health Economics by authors including Michael Chernew, Ph.D., a Harvard Medical School economist and chair of the Medicare Payment Advisory Commission. The study adds another wrinkle to the ongoing debate about whether health care services can be shopped for like a commercial service.

According to an abstract of the study published by the National Institute for Health Care Management (NIHCM) Foundation, “this study examines the factors that influence where patients receive elective lower-limb MRIs and the potential for patients to shop for this care. Results highlight the very important role that referring physicians play in patients’ choice of MRI provider and the lack of patient price shopping. Lower-limb MRIs should be highly shoppable because they are scheduled in advance, clinical quality does not vary meaningfully across providers and prices are widely variable. The fact that patients struggle to shop in this favorable setting makes it unlikely that greater cost sharing and price transparency will lead them to shop for more complex services.”

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