Treatment for medical bills
By SANDRA GUY firstname.lastname@example.org January 20, 2012 5:16PM
Updated: February 6, 2013 8:05PM
Kevin Kent, a 30-year-old entrepreneur looking to invent a next-generation baby monitor, negotiates with his doctor so he can afford the regular checkups he needs to regulate his diabetes.
He recently paid $275 for a physical exam and lab work that would have cost more than $600 because he worked out a deal with his physician.
The lab work includes tests of the thyroid, cholesterol and blood-sugar control, since diabetics are at increased risk of kidney and heart disease.
“Usually, I pay with cash or a credit card,” Kent said.
Kent is looking to take advantage of two technology innovations:
** A recently launched website, OKCopay.com, developed by Chicagoan J. Toure McCluskey. The site lets people compare the actual prices of 70 medical procedures throughout the Chicago area.
** And the increased willingness of investors — particularly those in Latin America — to help finance ideas such as Kent’s baby monitor.
In November, Kent moved to Santiago, Chile, from his home in River North to work on his invention at “Start-Up Chile,” an incubator that provided Kent with $40,000 in seed funding to realize this dream.
The medical-pricing search engine that Kent says he would welcome won an “Apps for Metro Chicago” award.
McCluskey painstakingly built the OkCopay site after being outraged over a $900 bill he received after he had gotten an MRI of his knee.
“I ended up paying only a deductible since I had health insurance, but I was curious what other places would charge,” said McCluskey, 35, who moved to Chicago two years ago after having earned his MBA at Stanford University’s Graduate School of Business. McCluskey and his wife DeShay, 32, a Chicago native, met while getting their MBAs at Stanford.
McCluskey discovered that prices in Chicago vary wildly for the same procedure. An abdominal MRI in downtown Chicago, for example, ranges from $325 to $2,100 at hospitals or care facilities that have won the highest levels of accreditation as imaging centers.
“In every other industry, people shop around before they make a purchase, whether it’s buying groceries, a car or an airline ticket,” McCluskey said. “You’re able to make an informed decision. But that’s never been true in health care.”
Users at OkCopay.com may sift through criteria other than price, including the doctors’ experience and qualifications, and whether the health-care center is accredited.
Users also can find health and dental clinics that serve the low-income or find clinics that charge sliding-fee scales based on one’s income.
“The database is free, and will remain free,” McCluskey said.
To make money, he hopes to charge doctors to advertise on the site as a way of promoting their practices and reaching people willing to pay cash for their services.
The eternally debated issue of mandatory health insurance in America has taken on new urgency with an 8.5 percent unemployment rate and U.S. Census Bureau data showing one in every five Chicagoans has no health insurance coverage.
Many are young people working as freelancers, bartenders and in part-time jobs who make too much money to qualify for state aid ($18,000 for singles is the cutoff) and who cannot afford individual health-care plans.
“They have no safety net,” McCluskey said. “They need care, but because of the cost, often go without it.”
Other groups interested in health-care shopping include those who are on employer-based high-deductible plans and those who want elective services such as cosmetic or Lasik eye surgery.
The market is expected to grow as companies continue to make employees pay a greater portion of their health-care costs, McCluskey said.
The OkCopay site is one of many such comparison sites entrepreneurs have tried over the years, but which end up stymied by a complicated thicket of regulations and long-term partnerships among doctors, hospitals, insurance companies and a myriad of other players.
Ayis Pyrros, a radiologist in the Munster (Ind.) Radiology Group, said key hurdles to an online price-comparison service include people’s willingness to pay exorbitant fees for medical care, doctors’ unwillingness or inability to disclose pricing, and a lack of powerful incentives to get doctors to participate.
Subbu Arumugam, co-organizer of Chicago Health 2.0/Tech, said similar price-comparison sites have run into problems with rules prohibiting doctors from making extra money off of referrals.
And lots of websites offer to help people manage their health-care costs, Arumugam said.
“There would have to be a groundswell, similar to the backlash against Wall Street, against the entire health-care pricing system,” he said. “I think the website should focus on a specific category such as diagnostic imaging.”
McCluskey believes the groundswell is coming.
“With nearly 75 million people classified as uninsured or underinsured, and more than 100 million without dental or vision coverage, the tipping point may have arrived,” he said.
Meanwhile, Kent’s idea, called PulseSocks, is to create high-tech baby booties integrated with sensors that would monitor a baby’s breathing, heart rate and other vital signs and alert parents in real time the moment the sensors pick up anything amiss. The booties’ sensors would send a wireless alert to a base station, which the parents could place next to their bed. The base station would make the parents’ cellphone ring to wake them up.
“Lots of my friends are having babies, and they have thousands of dollars worth of gizmos and gadgets, but nothing that works proactively before the child has started crying or choking or being in distress,” Kent said.