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By: Hellen Zaboulani
Close to a decade ago, New York tapped a health services firm to build a database to increase transparency on the price of health services and medical procedures across different health systems—but it has yet to open to the public. As reported by Crain’s, in 2016 NYS’s Health Department signed a $168 million contract with Optum, which is a part of insurance giant UnitedHealth, to build its health transparency tool, following the passage of a law allowing NYS to collect, store and analyze claims data from hospitals and insurance companies.
By gathering medical claims from Medicare and Medicaid, private insurers and hospitals, the database was to display true costs to help prospective patients to decide between different hospitals and centers and to bring transparency to New Yorkers. The database would help patients prepare financially for their upcoming procedures, helping them know what to expect, and also aid policymakers in pinpointing the main drivers of the climbing health costs.
The project was planned after state documents decried NY’s “fragmented, inconsistent and incomplete” information about its health care and that such a system was an “essential component of any health care payment reform.” Per Crain’s NY, now NYS has already paid Optum $159 million for its work on the database, per the state comptroller’s office, but the database is not yet up and running. Optum has not yet finished collecting the relevant data and has not made any claims information available to patients and researchers who want to be better informed about medical costs, the state said. So far, the database is only available internally to Health Department staffers. The state Health Department has blamed the delay on logistical hurdles and difficulties in obtaining data from hospitals and insurers during the pandemic year.
New Yorkers spends more on health care that in any other state, with an average cost of $14,000 per person in 2023. That’s 37percent higher than the national average, per data from the U.S. Centers for Medicare and Medicaid Services. The elevated medical costs have caused medical debt statewide— with over 700,000 New Yorkers having medical debt in collections as of 2022, and half of those individuals owing $500 or more, per a report from the Urban Institute, a think tank in Washington, D.C.
Hospital costs can be daunting, especially when we don’t know what to expect until after the bills are already rushing in. The law passed in NY in 2011, authorizing the database, set the state up to become a national leader. Other states had similar tools already, like Maryland which created the first such database in 1995. Per Crain’s, NY’s database, however, was slated to be the most comprehensive directory, as it would gather information on health care prices not only from medical claims, as most databases, but would also use birth and death data, hospital discharges and insurance enrollment to provide a more complete picture.
Since NY inked its contract with Optum, some 23 other states have followed suit, planned similar databases and they now have theirs up and running, per the U.S. Department of Health and Human Services. “We were ahead of the curve in 2011,” said Elisabeth Benjamin, vice president of health initiatives at the Community Service Society, a Midtown nonprofit which assists patients navigate medical debt.
