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Lawmakers look to take the mystery out of Alaska's health care prices

  • Author: Laurel Andrews
  • Updated: February 9, 2017
  • Published February 8, 2017

In coming weeks, the Alaska Legislature and Anchorage Assembly will both consider proposals aimed at providing Alaskans better information about potential medical costs.

Alaska's health care costs are among the highest in the nation. Alaskans spend thousands more on health care annually than the average American, and medical specialists in the state sometimes charge 10 times prices found in Seattle.

Rep. Ivy Spohnholz, an Anchorage Democrat, said she will introduce a bill by early next week that will require health-care providers to list prices for their most common procedures.

Spohnholz hopes her bill will "give consumers the info they need to make good choices."

Providers would publish procedure-cost lists for their offices and online, Spohnholz said. Individual physicians would be required to post the top 25 procedures; larger providers would need to post the top 50. The lists would then be updated annually, she said.

Spohnholz said the draft legislation gets the conversation started, and she wasn't "trying to go to war" with providers.

"Consumers just don't have the information that they need to operate, and we live in a capitalist country, and you can make choices about how to spend your money in just about any other area," Spohnholz said.

Separately on Tuesday, Anchorage Mayor Ethan Berkowitz's administration will introduce an Assembly ordinance that, if passed, would allow patients to request a price estimate of medical services.

Under the ordinance, providers would be required to give the patient an estimate within seven business days, which would list all the estimated procedures, services, supplies and other costs likely to be charged.

"In some ways this is a measure that's chiefly designed to empower the health care consumer, but it's also designed to say that if we have a health care market, it needs to operate like a market, and markets can't operate in the absence of price information," said Municipal Attorney William Falsey.

The provider could either work with the patient's insurance company to find out what would be covered, or just list what the price is for someone without insurance.

Billing codes would be included so patients could call their insurance providers to find out what's covered under their plan, Falsey said.

Providers would also be required to post a sign explaining that people can ask for an estimates of charges. If the provider failed to post a sign, or didn't provide timely responses to requests, it would be fined up to $1,000.

"We are acutely aware at the municipality that our own health care costs are growing at a rate that vastly exceeds annual inflation and it has been made clear to us that this is a problem for the citizens of Anchorage as well," Falsey said.

Health care costs comprise about 10 percent of Anchorage's annual operating budget, Falsey wrote in an email later.

Emergency services aren't included in the ordinance, due to "practical problems" with providing estimates in emergency situations.

The ordinance points to the work of other states that have adopted some measure of pricing transparency for consumers.

In California, for instance, consumers are able to request pricing estimates; hospitals must also list the costs of their 25 most common procedures.

Some states have government databases where prices are listed. Falsey said he was aware of other areas that have that requirement, but said "at this point we didn't think that we were ready for that kind of investment."

Becky Hultberg, CEO and president of the Alaska State Hospital and Nursing Home Association, said Wednesday the organization had received a copy of the Anchorage ordinance and planned to discuss it with the mayor and Assembly.

Hultberg said her organization's primary concern was whether the ordinance would create significant new costs for providers, but added it was too early to tell.

"Moving forward, we want to engage in that dialogue," Hultberg said.

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