The More You Know, the Less You Spend

When physicians can see a price tag, they might be a bit more likely to reign in the purse strings.  A study recently published in the Journal of General Internal Medicine shows that when physicians receive real-time information on costs, they often do not go through with ordering lab tests.

“Our study demonstrates that electronic health records can serve as a tool to promote cost transparency, educate physicians and reduce the use of potentially unnecessary laboratory tests by integrating the relative cost of care into providers' decision-making processes," writes Thomas D. Sequist, MD, MPH, of Atrius Health, the senior author of the study. "It's like putting price labels on goods you buy in the supermarket. When you know the prices, you tend to buy more strategically."

The study tested the effects of pricing transparency by comparing the frequency of lab orders between an intervention group of physicians who received real-time information through an EHR on laboratory costs for 27 individual tests to a control group of doctors who did not have access to the pricing information. Changes in the monthly laboratory ordering rate between the intervention and control groups were compared for 12 months before and six months after the intervention started.

At the conclusion of the intervention, researchers found that the physicians who had access to the pricing information through the EHR ordered significantly fewer high and low cost range lab tests than the physicians who ordered without cost data. In addition, physicians were generally very receptive to the intervention, with a majority (81%) reporting that the exercise increased their knowledge regarding costs of care.

The study was conducted among 215 primary care physicians working in Atrius Health, an alliance of six non-profit medical groups, and a home health and hospice agency in Massachusetts.