This week, a new website launched to shed some sunshine on the prices paid for health care in New Mexico. The website, nmhealthcarecompare.com, allows New Mexicans to compare average prices and quality metrics (such as readmission rates) for common, non-emergency procedures at each of the state’s 44 hospitals.
The new health care transparency website is the result of legislation passed in 2015 (Senate Judiciary Committee Substitute for Senate Bills 323 and 474). The legislation was based on recommendations from Think New Mexico’s 2014 report, Making Health Care More Affordable. The legislation, which passed both the House (52-0) and Senate (26-0) unanimously, reflected a bipartisan compromise that brought together Senate Bill 323, sponsored by Senator Mark Moores, and Senate Bill 474, sponsored by Senators Jerry Ortiz y Pino and Sander Rue. The joint bill was supported by the New Mexico Department of Health, the New Mexico Hospital Association, Think New Mexico, the AARP, the Foundation for Open Government, the League of Women Voters, the Con Alma Health Foundation, the national organization Costs of Care, and leading doctors across New Mexico, among others.
In its initial phase, the website includes the average prices paid by Medicaid for nine common non-emergency procedures (e.g., colonoscopies, mammograms, and baby deliveries) at all of the state’s 44 hospitals. It also includes quality metrics for the hospitals, such as 30-day readmission rates and patient ratings. Medicaid currently covers about 45% of all New Mexicans, and pays for about 72% of all births in the state.
Over time, the number of procedures listed on the website will be expanded, and average payment information will be included for New Mexicans who are covered by individual or employer insurance policies and Medicare, as well as average prices paid by Medicaid.
“The launch of the health care transparency website is an important first step toward giving New Mexicans the tools they need to shop around for the highest quality, most affordable health care, which is especially urgent in this era of rising deductibles,” said Fred Nathan, Executive Director of Think New Mexico. “We look forward to continuing to work collaboratively with the Department of Health and other stakeholders to expand this website to include the average prices paid by New Mexicans who are covered by individual or employer-based health insurance.”
In its 2014 report, Think New Mexico noted that nineteen other states, including Colorado, Arizona, and Utah, have already created health care transparency websites. New Mexico’s website was modeled on particularly effective sites from Maine (http://www.comparemaine.org) and New Hampshire (https://nhhealthcost.nh.gov).
Research by the University of Chicago has found that states with transparency websites saw the price of common, elective medical procedures drop by an average of 7% as a result of price competition. For example, hip transplants averaged $2,800 less in states with price disclosure websites than in states without them.
Similarly, states that publicly post health care quality data, like rates of hospital-acquired infections and readmissions, have seen hospitals compete to improve quality. For example, after Pennsylvania began publishing rates of hospital-acquired infections in 2006, the statewide infection rate fell by 7.8%, saving many lives as well as millions of dollars, because the cost of hospitalization when an infection occurs averages $53,915, while the cost of hospitalization without an infection averages only $8,311.
“Transparency around healthcare costs does not only serve an educational purpose,” said Department of Health Secretary Lynn Gallagher in a Department of Health press release. “It empowers New Mexico residents to make more informed decisions about their healthcare options.”
The Department also noted that: “Price transparency tools are essential to 1) help providers improve by benchmarking their performance against others; 2) encourage private insurers and public programs to reward quality and efficiency; and 3) help patients make informed choices about their care.”
More information about Think New Mexico’s research and advocacy on health care transparency can be found at: http://www.thinknewmexico.org/health-care-affordability and the transparency website itself is available at: http://nmhealthcarecompare.com