The $50 Billion Problem Nobody's Solving

There's a stat from a RAND Corporation study that I can't stop thinking about: if patients shifted just 10% of their shoppable healthcare services from high-cost to lower-cost providers, the savings would be in the neighborhood of $50 billion per year. Not over a decade. Per year.

The data to make this possible technically exists. Since January 2021, hospitals have been required by federal law to publish their prices in machine-readable formats. Insurance companies have been required to publish their negotiated rates. The information is out there, sitting on hospital websites and insurer portals.

And almost nobody is using it.

The Paradox of Mandatory Transparency

This is what I've started calling the transparency paradox. We have a federal mandate requiring price disclosure. We have hospitals publishing (some of) their prices. We have studies showing massive potential savings. And we have patients who, by and large, have no idea any of this exists and wouldn't know what to do with it if they did.

Only about 21% of hospitals are fully compliant with the price transparency rule. But even among the compliant hospitals, the data is published in formats that are designed for machines, not humans. We're talking about massive CSV files with hundreds of thousands of rows, using internal billing codes and insurance-specific identifiers that mean nothing to a normal person.

Try this experiment: pick a hospital in your city, go to their website, and try to find out how much a knee MRI would cost with your insurance. I'll wait. Actually, don't bother. I've done this hundreds of times, and even I struggle with it. The files are buried, the search functionality is nonexistent, and the pricing data is presented in a way that requires significant expertise to interpret.

Compliance Without Usability Is Theater

There's a cynical reading of the current situation, and I think it's at least partially correct: many hospitals are technically complying with the transparency rule while making sure the data is as difficult to use as possible. Publish a 2 million-row CSV file with no search interface? Technically compliant. Use internal procedure codes instead of standard CPT codes? Technically compliant. Bury the link to your pricing file three clicks deep in the footer of your website? You guessed it: technically compliant.

This is what happens when you mandate disclosure without mandating usability. The regulation says hospitals must publish their prices. It doesn't say they have to make them easy to find or understand. So the letter of the law is met, while the spirit is completely undermined.

I want to be fair: not all hospitals are doing this intentionally. Some smaller hospitals genuinely lack the technical infrastructure to do better. Their billing systems are ancient, their IT budgets are thin, and producing a clean, well-structured pricing file is harder than it should be. But the large hospital systems with dedicated compliance teams? They know exactly what they're doing.

The Consumer Tool Gap

This is the problem that motivated me to build Panopticare. The raw data exists, but there's a massive gap between "data exists somewhere on a website" and "a patient can use this to make an informed decision."

Bridging that gap is harder than it sounds. You need to ingest files from dozens of hospitals, each with their own format and naming conventions. You need to normalize procedure descriptions so that "Total Knee Arthroplasty" at one hospital matches "TKA - Total Knee Replacement" at another. You need to cross-reference hospital prices with insurance-specific negotiated rates from Transparency in Coverage filings. You need to handle the fact that the same procedure might have five different CPT codes depending on complexity, setting, and who's billing for it.

We've built a system that does all of this. Our CPT-anchored registry has over 15,000 procedures with about 75,000 aliases to handle the naming variation. We're pulling in data from over a hundred hospitals and cross-referencing it with payer-specific rates from major insurers. The semantic search lets you type "knee surgery" and get meaningful results even if no hospital uses exactly those words.

But I'm under no illusion that we've solved the problem. We're one tool covering one metro area. The $50 billion problem requires solutions at scale: tools that cover every market, handle every insurer, and are accessible enough that the average person can use them without a medical billing degree.

Why This Isn't Just a Technology Problem

It would be convenient to frame this purely as a technical challenge: the data is messy, we just need better tools. But the truth is that the incentives in healthcare are actively working against transparency.

Hospitals with market power benefit from price opacity. If patients can't easily compare prices, those hospitals can charge more without losing patients to lower-cost competitors. Insurance companies benefit because opaque pricing makes it harder for consumers to evaluate whether their insurer has negotiated good rates. And the entire ecosystem of middlemen (billing services, revenue cycle management companies, PBMs) exists partly because the system is so complex and opaque.

Making prices truly transparent threatens a lot of revenue streams. That's why progress has been so slow despite a clear federal mandate, broad public support, and demonstrated potential savings.

But I think the ground is shifting. ACA subsidy changes are pushing more people into high-deductible plans where they directly feel the cost of healthcare services. CMS is starting to actually enforce the transparency rules. States are passing their own legislation. And consumer tools are getting better at turning raw data into actionable information.

The $50 billion problem isn't going to be solved by any single tool or regulation. It's going to take all of these forces pushing in the same direction. The data is there. The savings are real. What we need now is to close the gap between information and action.