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What Do Real Estate and Health Care Have in Common?

I live in Portland, Oregon. Like many U.S. cities, Portland is experiencing a very hot real estate market right now. I know many friends and colleagues who are searching for a home that fits their families’ needs and is also affordable. It’s a fine line to walk, especially when there are so many different players in the real estate game, and there’s significant emotional and financial investment involved.

Everyone’s trying to purchase a home of good value — striking that balance between the size of the home they want and the purchase price. This delicate balance between size and purchase price strikes me as similar to a conversation we’re having around health care costs in the United States.

President Trump recently signed an executive order requiring hospitals and insurers to share their negotiated prices for “shoppable” services. According to the executive order, these common, nonemergent services “make up a significant share of the health care market.” While there is still plenty to be sorted out in rulemaking, the news has thrust health care price transparency back into the national spotlight. It’s no secret that health care costs are unsustainable and are a huge strain on both national resources and families’ budgets, and this executive order is an attempt to increase price transparency to impact total cost.

What do we mean when we talk about cost? At Comagine Health, we’re saying:

Utilization of Health Care Services (Intensity) × Price of Services = Cost of Care

If health care costs are a house, utilization is size of the home and the price is per square foot. Simply saying a house’s price is $100,000 tells you very little about the home. When was it built? How many bedrooms does it have? Where is it located? What kind of condition is it in? These are just a few of the many things you need to know to decide whether a house is usable or meets your family’s needs. The parallel holds for health care — price alone only tells a portion of the story.

Comagine Health is adding more to the story with the help of the Network for Regional Healthcare Improvement. In Oregon and Utah, we’ve been using the HealthPartners® Total Cost of Care methodology to measure the total cost of health care for commercially insured patients and providing customized reports to primary care practices. In addition, our Compare Your Care website helps Oregon consumers make informed decisions about their health care by providing cost and quality scores for doctor’s offices across the state.

Don’t Go It Alone!

I don’t know many people who would feel comfortable purchasing a home without consulting a real estate agent, mortgage lenders, appraisers or contractors. I know I’ve leaned heavily on the expertise and knowledge of others when I’ve purchased homes. Of course, we couldn’t and wouldn’t do our total cost of care work without the support and expertise of our colleagues and stakeholders who consistently come to the table to advocate for transparency and help us address affordability in our communities.

Where We’re Headed and Why it Matters

Measuring and reporting the cost of health care matters, not just because we care about our stakeholders and our communities, but because we are all individually feeling the pinch of rising health care costs. In a recent all-staff training, I asked my colleagues to raise their hands if they or their loved ones have ever forgone medical care due to cost, and most people raised their hands. We must do better, and Comagine Health is committed to continued measurement and transparency around the cost of care.

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