Yesterday, I spoke to Alex Fair of FairCareMd.com, a New York-based company which lets patients and doctors directly negotiate a “fair deal” on services between themselves. Physicians give (presumably big) discounts on services in exchange for getting cash on the barrelhead once the service is delivered. The site is in beta but still worth a look; seems the key pieces are in place.
Fair, a former scientist who’s been a serial entrepreneur for many years, once designed software helping doctors successfully beat claims denials, so he definitely knows the territory. And he’s obviously right that if they get cash up right away, doctors can easily beat the “retail” prices they’re sometimes forced to charge to cover health plan collection costs.
Fair’s (reasonable) assumption is that FairCareMD will be a lifesaver for patients with high deductibles or no insurance at all, as well as giving them a way to get procedures the insurance industry won’t cover. Not only will patients have access to deeply-discounted fees, if the patient can’t find the deal he or she wants, they can push for a better price at a number they can live with. That is indeed along the lines of Priceline.com’s “name your own deal.” (I’m here to tell you that *that* mechanism works very well indeed.)
On the surface, the concept makes sense. And there’s precedent for it. For example, a thriving market in cash-for-surgical-services, much along these lines, already exists in the bariatric surgery industry, as many health plans refuse to cover such procedures. Ah, the power of capitalism to work around other capitalists!
In his first month since launch Fair reports over 5,000 searches for care on his site, though only about 1 in 200 visitors requested a deal from a provider. On average these deals have saved 47 percent off “list prices” so far. Fair’s surprised that so few consumers are making requests. On the other hand, it’s only a few weeks after launch, and other sites have millions of such requests, so he’s in wait and see mode.
My guess is that a) people don’t see the value of shopping for prices just yet — so thoroughly has the health insurance industry hornswoggled them and that b) they’re likely to see more valuable in accessing such services if they pay a subscription fee. Just a human nature thing.
So hey, folks, what do you think? What will it take for consumers to feel comfortable paying doctors directly again? Fair isn’t the only company banking on this notion — in fact, there are several, including some with a national presence — but my instincts suggest they haven’t won consumers over completely yet either.
An even bigger question: Do you see the broad mass of consumers developing those sorts of relationships with hospitals anytime soon? Now *that* would be a neat trick.
NOTE: If you’re in the NYC region, or plan to be next week, you can meet Fair and other local social media/health entrepreneurs at a Manahattan-based Health 2.0 meetup (details at http://www.health20nyc.com/calendar/13913750/?eventId=13913750&action=detail#initialized). Looks like it’s going to be a very nice group. I’ll be moderating a panel, so if you’re there please stop by and say hello!