Health care costs are a mystery to most people. A McKinsey survey of consumers last January found that 75% of them simply answered “I don’t know” when asked how much treatment for a heart attack would run. Asked about the yearly cost of treating diabetes, 78% were clueless, and 82% had no idea how much it would cost to treat a family member with Alzheimer’s. The respondents who did think they knew were pretty far off the mark. On average, they estimated the heart attack treatment would cost $48,222, 135% more than McKinsey’s figure of $20,489. They were 54% too high on the diabetes, and 16% over the Alzheimer’s total. Of course, the cost of treatment varies widely depending on the details of the patient’s condition, as well as other factors including what part of the country the person is in (as the Dartmouth Atlas folks show every year). So it’s a bit unfair to say any

particular estimate is flat-out wrong. Still, the findings highlight one more aspect of a problem I write about in today’s Healthy Consumer column : There’s a lot people don’t understand medical expenses, including the terms of their own health plans and what they have to pay out-of-pocket for care. In reporting this column, I talked to medical-practice administrators who said their staffs spend lots of time trying to help patients understand their insurance and figure out what they owe. I also talked to several health plans that are making efforts to clarify the materials they supply for customers, by using less jargon and writing more simply. Health Blog Questions of the Day : What could insurers do to make plans easier for customers to understand? Should the government require insurers to be clearer about what is and isn’t covered?

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What Could Insurers Do to Make Plans Easier to Understand?