Will Posting Prices Trigger a Price War?

December 1, 2013

by Nancy Vessell

Nancy Vessell profile picKeith Smith, MD, is a soldier of free-market health care, and he wants to start a price war. He has fired the first volley by posting guaranteed, all-inclusive prices for most procedures performed by his Surgery Center of Oklahoma (SCO) on its website (www.surgerycenterok.com).

The outpatient surgery center’s prices are often one-fifth the cost for the same procedures at hospitals in the Oklahoma City market, as reported by the local news media.

A TV station in that market reported in July that a gall bladder can be removed for $5,865 at SCO, while the procedure cost $21,556 at a local hospital. A hysterec­tomy priced at $8,000 at SCO was billed at $37,174 by another local hospital.

The SCO’s extreme price transparency has received lots of media coverage within the past year – and that has brought patients from far and wide.

“It has exploded,” Smith says of patient volume. Pa­tients have come from 49 states and as far away as Turkey and Nigeria. Patients coming to SCO by way of its website were few at first, but with the increased attention, it now accounts for about 20 percent of business, he says, with most of that increase coming in the past year.

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