Conducting a search on the internet for information related to unnecessary medical care produces a mass of information, including many news articles. One such news article published by the Huffington Post provides information on a campaign called Choosing Wisely, which is the combined effort of multiple medical societies with the goal of reducing unnecessary medical interventions that waste money and in some cases, do more harm than good. One of the reasons cited in the article for unnecessary interventions is the concept of information asymmetry (Haelle, 2013). This paper will discuss information asymmetry within the context of healthcare delivery, including the implications for the healthcare industry and possible solutions to reduce the
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First of all, as outlined in the Huffington Post article, information asymmetry can lead to unnecessary treatments. To put this problem into perspective, another article on the prevalence of unnecessary care in the US references a study in which 25-42% of Medicare patients received at least one of twenty-six tests or treatments deemed “low-value care.” An example of one such test is doing an EEG for an uncomplicated headache. The author of this article elaborates on the premise of information asymmetry by stating that patients are unable to determine the quality of the advice that they receive (Gawande, 2015) and will, therefore, go along with the physician’s treatment plan. In the regular market, when a consumer purchases something, the benefit they anticipate receiving is higher than the value of the money spent on the product. However, in the healthcare market, it can be challenging to determine the value one will receive for the money spent, especially at the point in time when patients are seeking care, that is, when they are in pain or alarmed at what they are contending with (Frakt, 2011). Therefore, patients will go along with whatever the physician has …show more content…
For example, price transparency is a major initiative of the Healthcare Financial Management Academy (HFMA). This institution believes that publishing the average prices paid by payors for various procedures and treatments will lead to better medical decision-making (Johnson, 2015). However, since most patients are insulated from the true costs of their care due to the involvement of third party payers, other experts feel that this solution will have minimal impact (PL, RS, & LA,
First of all, as outlined in the Huffington Post article, information asymmetry can lead to unnecessary treatments. To put this problem into perspective, another article on the prevalence of unnecessary care in the US references a study in which 25-42% of Medicare patients received at least one of twenty-six tests or treatments deemed “low-value care.” An example of one such test is doing an EEG for an uncomplicated headache. The author of this article elaborates on the premise of information asymmetry by stating that patients are unable to determine the quality of the advice that they receive (Gawande, 2015) and will, therefore, go along with the physician’s treatment plan. In the regular market, when a consumer purchases something, the benefit they anticipate receiving is higher than the value of the money spent on the product. However, in the healthcare market, it can be challenging to determine the value one will receive for the money spent, especially at the point in time when patients are seeking care, that is, when they are in pain or alarmed at what they are contending with (Frakt, 2011). Therefore, patients will go along with whatever the physician has …show more content…
For example, price transparency is a major initiative of the Healthcare Financial Management Academy (HFMA). This institution believes that publishing the average prices paid by payors for various procedures and treatments will lead to better medical decision-making (Johnson, 2015). However, since most patients are insulated from the true costs of their care due to the involvement of third party payers, other experts feel that this solution will have minimal impact (PL, RS, & LA,