What use is our Medicare Cost Tool?

When we show informed health care consumers (like physicians) our Medicare charge tool at http://www.healthyhive.com/medicare_charges/ the initial reaction is “wow, awesome interface and very informative.  But this would confuse the average consumer – in fact, it’s not clear to me that this is at all useful!”
Aside from being humbling to hear, it also reminds us the struggle we are up against:  trying to push consumer engagement without making them drool or fall asleep, thus leaving them to fall back into an apathetic state.
The good news, is, at least for Massachusetts consumers, the Commonwealth has legislated that consumers can contact their insurance carrier to receive cost estimates for a procedure and the carrier must provide them with an estimate in a timely manner.  So our tool can be used as a starting point to assess the variance of costs across providers in your geographic area.  Even if you are not looking for the specific procedure listed in the Medicare cost data, you can start by asking for estimated costs from several different providers based on relative costs posted in the Medicare data.  By October of 2014, consumers with private insurance will be able to use tools provided by carriers to estimate costs…this is assuming the tools will be easy to use and are widely publicized…
Example:  search for the last outpatient service listed in the drop down menu (MRI service) within a 15 mile radius of zip code 02110.  The average “Covered Charge” is $2,263.72.  The range is a staggering low charge of $1,158.34 and high of $3,899.67.  Note, these are the chargemaster prices.  Chargemaster topic will be covered in another posting, but suffice to say this article below is a good start.  Written by a Princeton economist with a PhD from Yale, don’t be shocked if the topic is a bit “confusing”.
http://content.healthaffairs.org/content/25/1/57.long