Know what executives at Coca-Cola, IBM, Verizon and American Express have in common? A profound concern over how much they are paying every year for healthcare.
So 20 of the most recognizable names in corporate America have formed what they are calling the Health Transformation Alliance. The point is to share data about prices and outcomes and see if they can crack the healthcare black box to find some value.
Well, now 20 companies are ready to get dirty in data
“Nobody has brought together these many companies at this magnitude with a real willingness to sit down together, bring together their collective data and get better answers from healthcare,” said Tevi Troy, one of the architects of the group.
The companies in this alliance spend more than $14 billion a year on health care for 4 million people. They want to crunch all that data on price and outcomes, hoping to find good deals.
Yale economist Zack Cooper — who has pawed through troves of data — warned it’s ugly under the hood.
“The variation in price is just insane,” he said. “In the same cities MRIs vary by a factor of 10. They are going to find there is no relationship between price and quality.”
In theory, this new initiative turns up the heat — especially on hospitals — to be more transparent about how well they do what they do and how much it all costs.
“Symbolically this is a really important move,” said Harvard’s Dr. Ashish Jha, though he added he’s not convinced the Alliance in particular is any kind of game changer.
That said, hospitals tend to make their margins off of the privately insured, and that alone gives business a loud voice.
“The people who write the checks tend to have a lot of influence on what happens in a marketplace,” he said. “And employers have just not been as engaged as they need to.”
Remember, 170 million Americans get their healthcare through work. And if companies start taking the purchase of healthcare as serious as they take their own business, Jha said the potential for transformation is there.
There’s a lot happening in the world. Through it all, Marketplace is here for you.
You rely on Marketplace to break down the world’s events and tell you how it affects you in a fact-based, approachable way. We rely on your financial support to keep making that possible.
Your donation today powers the independent journalism that you rely on. For just $5/month, you can help sustain Marketplace so we can keep reporting on the things that matter to you.