Health care providers have a moral obligation to disclose out-of-pocket costs before patients receive care, concludes an article by Alicia Hall in the May-June Hastings Center Report. While information about costs is typically obscure to patients until long after treatment, the article says that “the financial impact of treatment decisions on patients’ lives cannot be downplayed.”  In addition, a front-page article in The New York Times last month reported that several influential medical groups are suggesting that doctors consider the costs of treatments when they recommend care to patients. “Protecting patients from financial ruin is fundamental to the precept of ‘do no harm,” stated a joint statement by the American College of Cardiology and the American Heart Association. This week, the Wall Street Journal reported that insurers are aiming to curb the very high costs of cancer treatment by paying doctors incentives to prescribe recommended drugs.

“Alicia Hall’s recommendation to disclose costs to patients is an effort to make us face reality,” says Mildred Solomon, president of The Hastings Center. “She wants us to take seriously the implicit realities of a market-based health care system, which is what we have in the United States.  If we construe health care as a commodity and patients as consumers, then it follows that health care providers are vendors, who must disclose cost. Consumer choice and downward pressures on cost, which market-driven competition is meant to achieve, won’t work unless costs are transparent to patients well before they make decisions to buy. If we’re going to go with a market-driven approach– and, of course, whether we should is a big question–then we have to take Hall’s argument seriously.”

A Closer Look at Ethical Issues Pro and Con

There are strong ethical arguments for greater awareness of out-of-pocket costs, but there are also concerns that it could harm some patients.

Arguments for greater consideration of costs. Hastings Center scholars and publications have long acknowledged that cost is an ethical issue in health care.

• The Hastings Center Guidelines for Decisions on Life-Sustaining Treatment and Care Near the End of Life recommends that health care professionals “discuss the economic impact of treatment and decisions on patients and loved ones.” It contains a guide for hospitals and other institutions to use for increasing transparency of health care costs and developing a policy for considering costs in resource allocation. “The ethical goal of treating all patients equitably requires health care institutions to grapple with the moral as well as the fiscal dimensions of resource allocation and health care cost,” states Guidelines.
• In her Hastings Center Report article, Hall cites two moral reasons for disclosing out-of-pocket costs. One of them is autonomy, the right of patients to make informed choices about their bodies. Patients need to know about potential side effects of treatments to decide which side effects they are willing to tolerate. “This same reasoning applies to the financial side effects of treatment,” the article says, which can include personal bankruptcy and “trade-offs between paying for health care and paying for food, utilities, or housing – the lack of which can also have significant impacts on health.” Another moral reason for greater disclosure is justice: failing to disclose out-of-pocket costs is likely to be most harmful to the most vulnerable patients, those with the least ability to pay.
• The American Society of Clinical Oncology, the American College of Cardiology, and the American Heart Association recognize that physicians have an obligation to address the wide variations in practice that now occur around the country and to build treatment protocols that are based on evidence and offer the greatest value for the costs. In cancer care, for example, the current system has perverse incentives to use higher-priced treatments. Many oncologists are paid a proportion of what is spent for chemotherapeutic agents for their patients. The more drugs ordered, and the more they cost, the higher the doctor’s income. Treatment recommendations, designed by professional societies, can reverse this trend.

Concerns about greater consideration of costs. Some patients might reject necessary treatment after learning how much it will cost them, possibly resulting in significant harm. Many doctors are uncomfortable with weighing costs when recommending care to patients because they fear that it could influence them to advise against an optimal intervention for patients who could not afford it.

Some physicians welcome the new guidelines, but believe they should be established and monitored by a third party, so that physicians are not the ones initiating conversations that might undermine patient trust. Some commentators welcome approaches that reinforce physicians’ efforts to practice in ways consistent with new guidelines, but worry that insurers’ financial incentives for doing so, such as those by WellPoint described in the Wall Street Journal article, are inappropriate because they could impair independent physician judgment. There is also a potential for standardized pathways to impede the drive for more individualized care based on genetic information.

News in context

There are several reasons for the increased calls for doctors and patients to be better informed about out-of-pocket medical costs. Implementation of health care reform has left many people with higher co-payments and deductibles, and others remain uninsured. Paying medical bills is a great struggle for many Americans: a recent survey of chronically ill patients found that 1 in 3 cannot afford food, medications, or both.  U.S. health care costs are a major cause of personal bankruptcy.

Health care costs are far higher in the U.S. than in other developed countries, and yet the U.S. lags behind many of them on several health outcomes, including infant mortality, heart disease, and chronic lung disease. All of these factors point to the need for greater transparency about health care costs and a greater understanding of the value of individual medical interventions.  “We are in this situation, because we have refused to have a grown up conversation about cost at the societal level,” says Mildred Solomon. “Unlike in other developed countries, there has been no support in the United States for technology assessment and Congress has even forbidden Medicare to consider cost-effectiveness research in its reimbursement decisions. So now, we see others stepping up to fill this void. The specialty societies are demonstrating civic responsibility and great professionalism.  In addition, at the national level and for numerous kinds of health treatments, we need a third-party entity without conflicts of interest and with major citizen input to undertake cost-effectiveness studies and issue trustworthy recommendations.”