Okla. Surgical Center Reveals Prices to Patients

New tactic could help keep down skyrocketing medical costs.

ByABC News
August 23, 2013, 4:25 PM

Aug. 27,2013— -- When Ira Horner, 62, found out how much his knee surgery for a torn meniscus was expected to cost, he worried that he would spend the rest of his life in debt.

A floor associate at Hutchinson Oil, in Woodward, Okla., Horner had health insurance through his employer, but it was unclear as to what he would ultimately be expected to pay.

After talking to friends and nurses at the medical center where he was being treated, Horner estimated the surgery would cost at least $16,000, and he'd end up paying about 20 percent of that plus his $1,000 deductible.

But his doctor never gave him an actual number, he said.

Horner, who in January of this year was getting through his day without fully extending his leg, worried he would be left "thousands of dollars in debt." The surgery wouldn't bankrupt him, he said, but it would require years to pay off.

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He was planning to schedule his surgery when his insurance administrator held an informational session about certain providers in the state that would provide less expensive care for certain procedures. If Horner picked one of these providers, the insurance company would pick up the entire tab.

One provider was the Surgery Center of Oklahoma, an ambulatory surgical center 140 miles away from Horner's home in Woodward, which would perform the knee surgery for approximately $3,400 total. The center is one of the few medical centers that provide up front inclusive pricing for services.

"I thought, Wait a minute … something is wrong with this process," Horner said. The price included the facility fee, the surgeon's fee and the anesthesiologists' fee.

Horner immediately went back to his doctor and gave him an ultimatum: Either work out a lower price plan with my insurance company or lose me as a patient.

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It worked: Horner's insurance administrator worked out a lower price with his original medical center and Horner ended up only paying the $1,000 deductible for his surgery. Everything else would be covered by his insurance.

Horner never even had to travel to the Surgery Center of Oklahoma for so much as a consultation.

It's a tactic that experts say could help keep down skyrocketing medical costs for both patients and insurance companies.

In most industries, prices are posted online, but in the medical field it can be almost impossible to get a procedure's price before the bill arrives. As healthcare costs continue to rise at a rate higher than inflation, some experts are hoping that more medical centers will offer transparent pricing.

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According to a study from the Kaiser Family Foundation, the average annual family premium for 2013 is $16,351, about 4 percent higher than the average premium in 2012. Since 2000, the Health care costs have increased in the U.S from $4,878 per person to $8,680 per person or 2.7 trillion in 2011, according to the Centers for Medicare & Medicaid Services.

Four years ago the administrators at the Surgery Center of Oklahoma decided they would post prices for their surgeries, since they felt their center was more reasonably priced than other medical providers in the area.