Economic Disruption in Healthcare Symposium - Part II

1. Economic Disruption in Healthcare Symposium - Part II H. Stuart Elway, PhD Will Consumers Shop For Health Care?

2. Health Care Moving to Consumer Choice Models • Will health care consumers price shop? • Do consumers exercise choice now? • Do consumers want more choice? • Is it even possible for consumers to shop?

3. Health Care System Through the Eyes of the Consumer Public Agenda Foundation • Most unaware of how HCS really works • Concerned about personal HC spending • Only 30% confident they can afford care they need • Concerned about national spending trends • Support cost-saving concepts, but no consensus

4. Our Research • Focus Groups • Survey of WA residents • 500 heads of household 18-64 • March 13-18

5. Respondent Profile 42% over age 5016% under 35 68% Couple41% Children at Home 60% Employed Full Time14% Employed Part Time 53% College Degree

6. System Usage 82% have regular physician 37% did own research 20% visited Doctor 0-1 times last year 21% visited 12+ times last year 52% saw specialist in last year

7. Health Insurance Coverage 60% Chose from among plans offered by employer

8. Reason for Choosing Insurance Plan 53% Do not know their Maximum Out-of-Pocket Limit

9. Why is Health Care So Expensive?

10. Potential Impact of Comparison Shopping on The Health Care System

11. Advantages / Disadvantages of Shopping for Medical Treatments Disadvantages 33% Quality Concerns 27% Consumer Burden 6% Higher Costs 2% Less Choice 18% No Disadvantages Advantages 48% Lower Cost 37% Choice 14% Better Quality 2% No Advantages

12. Consumers Able / Want to Price Shop?

13. Why Shopping Would be Personally Desirable / Undesirable Undesirable 40% Not Needed 26% Consumer burden 18% Lower quality 9% Higher cost Desirable 30% Choice/Control 30% Lower cost 18% Better value 14% Better quality

14. Potential Impact of Consumer Shoppingon Health Care

15. Would You Price Shop for Treatment HESITATION: 30% Quality of Care 21% Happy w/ current Dr 13% Price Not Everything 13% Specific situation 9% Consumer burden 8% Use recommendations

16. Likely to Price Shop for Specified Procedures

17. Past “Shopping” Behavior

18. Hypothetical: Choose Provider 69% aware that different providers charge different fees for same treatment PROVIDER A: $10,000 PROVIDER B: $7,500

19. Hypothetical: Choose Provider PROVIDER A 56% Better Care 16% Not Sure PROVIDER B 90% Cost savings 22% If Quality Equal

20. Hypothetical: Choose Provider “DEPENDS” 71% Quality of Care 17% Cost not only concern 12% the Procedure

21. Additional $$ Factors

22. Potential Impact of Rebates on Health Care System

23. Impact of price shopping on overall cost of health care Impact on personal decisionsof lowering overall cost

24. So, Will Consumers Shop? Foreign concept • Difficult to relate to the question • Seen in familiar insurance context Indicate willingness on surface • Have not thought it through • Reluctant when given time to consider Seen as shifting cost to consumers • Personal costs rising as it is • Concern that result in avoidance of care

25. So, Will Consumers Shop? Care Situation • Emergency • Costs of Component treatments • Reluctance to second guess Doctor Information • Lack of expertise, confidence • Learning curve (time burden) • Lack of information (comparative data) Significance of choice

26. So, Will Consumers Shop? Quality is the trump card Door is open to discussion

27. Economic Disruption in Healthcare Symposium - Part II H. Stuart Elway, PhD Will Consumers Shop For Health Care?