A consumer in healthcare = an alice in wonderland

Open Access
Author:
Bashwiner, Caitlin Rose
Area of Honors:
Finance
Degree:
Bachelor of Science
Document Type:
Thesis
Thesis Supervisors:
  • Brian Spangler Davis, Thesis Supervisor
  • Brian Spangler Davis, Honors Advisor
  • James Alan Miles, Faculty Reader
Keywords:
  • procedure pricing
  • healthcare
  • affordable care act
  • price transparency
Abstract:
If a hospital were to act like a true business, the organization would need to utilize a model while pricing procedures to ensure profitability and consistency. I set out on the journey to determine how hospitals do price procedures. This topic became more and more interesting along the way because all too often, hospitals do not disclose to the public how they price their procedures. While master charge lists for common procedures are accessible, these lists change rapidly and give no reference to where the numbers are actually coming from. I hoped to understand how hospitals track cash inflows and outflows and price accordingly. From there, I planned to gain an understanding of what the uncertainties and issues are with the models hospitals use to do so. Then, the goal was to hone in on one specific model and utilize quantitative analysis to find ways to make improvements. Going into this journey, I knew the result would be interesting, given all the recent reforms with the Affordable Care Act. I never knew, however, that what I would find was the answer to my question was actually a complete lack of an answer. This bolstered within me a belief that price transparency is not much more than an idea in the United States.