But the identity of a patient’s orthopedist explains a lot more about where he or she got her M.R.I. than any other factor considered, including price and distance. Less than 1 percent of patients in the study sample availed themselves of a price comparison tool to shop for M.R.I.s before receiving one. By this reasoning, the authors concluded that doctors sent people to more expensive locations than they had to. On the way to their M.R.I., patients drove by an average of six other places where the procedure could have been done more cheaply. “Many patients are going to very expensive providers when lower-price options with equal quality are available,” said Zack Cooper, a health economist at Yale and a co-author of the study. Though patients seem to follow the advice of their doctors on where to go, their doctors don’t have all the information on hand to make the best decisions for the patient either. There are over 15 M.R.I. locations within a half-hour drive for most patients. As with many health care services, there is a large variation of prices across these locations, which means a tremendous opportunity to save money by selecting lower-priced ones. In one large, urban market, prices for the procedure are as low as about $280 and as high as about $2,100. If patients went to the lowest-cost M.R.I. that was no farther than they already drove, they’d save 36 percent. Savings rise if they’re willing to travel farther. Within an hour’s drive, for example, savings of 55 percent are available. Savings are split between patient and insurer, depending on cost sharing. On average, patients pay just over $300 toward the cost of the procedure. There is no evidence that the quality of low- and high-priced M.R.I.s differs, at least enough to be clinically meaningful. The study found that virtually none of the M.R.I.s at any price level had to be repeated — strong evidence that the doctors relying on them are satisfied even with the lower-priced images. At almost $1,500, the average price of a hospital M.R.I. is more than double that of one at an imaging center. The study found that doctors who work for hospitals (rather than independently) are more likely to send their patients for more expensive hospital-based imaging. Just getting all patients to use M.R.I.s that are no farther away and not in a hospital could save 16 percent.
Shopping for health care is often too complicated and, even when it works, most people don’t. The theory behind high health insurance deductibles is that the more an individual has to spend on health care, the more careful they will be – thereby purging wasteful procedures from the system. But high deductibles aren’t working as they should, and research shows that people cut back on care when they have more to spend for it. They also cut necessary care, rather than just the wasteful kind. Patients don’t know what care they need so they consult doctors and medical expects, which runs counter to the rising trend of encouraging people to make their own judgments about what care is worth the price. Not all care is related to an emergency; some is elective and therefore “shoppable.” Researchers estimated that between 30 and 40 percent of care, such as routine check-ups, falls into this category. But very few shop for this type of care, and even when price transparency tools are offered to make it easier, almost no-one uses them. A National Bureau of Economic Research working paper focused on one particular “shoppable” service, non-emergency, outpatient, lower-limb MRI scans. The study showed that patients typically get their MRIs wherever their physician recommended, with little regard to cost. In addition, less than 1 percent used a price comparison tool to shop for MRIs before getting one. As such, the study’s authors concluded that doctors send patients to more expensive locations than required. Zack Cooper, a health economist at Yale and co-author of the research, added that doctors don’t have all the information to make the best decisions for their patient either. There are more than 15 MRI locations within 30-minutes’ drive for most patients, and the average price of a hospital MRI is more than double that of one at an imaging center. But researchers found that physicians who work at hospitals are more likely to send a patient for costlier hospital-based imaging, despite the fact that the quality of low- and high-priced MRIs doesn’t differ enough to be clinically meaningful. And if people can’t shop for elective MRIs, they are unlikely to do so with other more complicated health care procedures, the study suggests. Instead, what is more likely to work is influencing what doctors advise.