It's an old saw: Competition is good for everyone. In health care, competition can be good for those who are paying the bills. But just how good is competition at holding prices down?
A Health Affairs study that looked at the average prices for common procedures in areas of high and low physician practice concentration produced a range that was telling: "In 12 of the 15 procedures, prices were 8 percent to 26 percent higher in counties with the highest average physician concentration compared to counties with the lowest average concentration," Heath Affairs reported.
The study was based on 2010 figures. The physician practice landscape has changed since then, but at the same time, more steps have been taken by payers to address procedural price increases. So perhaps the data is relevant to today's market.
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This study comes on the heels of another that examined common procedures — many of them specific to female patients — by region of the U.S. That study also reported a wide range of prices for the same procedures, depending upon the local of the health care provider.
Of the 15 procedures examined in the Health Affairs study, only three showed no relation between physician practice concentration and price: intensity-modulated radiation therapy, shoulder arthroscopy and kidney stone fragmentation.
The study's authors said public policies that effect physician practice organization, concentration and pricing should examine the potential impact of greater concentration on the cost to the consumer.
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Dan Cook
Dan Cook is a journalist and communications consultant based in Portland, OR. During his journalism career he has been a reporter and editor for a variety of media companies, including American Lawyer Media, BusinessWeek, Newhouse Newspapers, Knight-Ridder, Time Inc., and Reuters. He specializes in health care and insurance related coverage for BenefitsPRO.
