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To give a specific pair of contrasting examples:

  • If I search for homes for sale in say Michigan, I can quickly see the listed price for each home. (See e.g. Zillow.) Sure, there might be taxes, commission, fees, discounts, etc., but the final price I pay will almost certainly be within ±50% of the listed price I see.
  • But if I search for an assisted living or adult foster care home (for the elderly) also in Michigan, I am unable to find a single home that lists any price on its website, Facebook page, or anywhere else. Instead, every single home asks you to call or email them, or arrange for a tour. I have no idea what I'll have to pay, even very roughly, perhaps not even to an order of magnitude. I truly have no idea if the cost per month will be \$1,000, \$5,000, or \$10,000.

Unfortunately, from my brief search, there doesn't seem to be much research by economists on this topic (but let me know if I'm mistaken).

Here are some possible explanations I've considered:

  • Price transparency tends to be decreasing in price.

This might be generally true, but fails to explain why there is so much less price transparency in healthcare than in real estate.

  • In healthcare, there is much more uncertainty and variation as to what each patient will end up costing.

But each healthcare facility does have standard rates for particular items, such as "a standard type X blood test", "a brain MRI in Machine #566", "a 24-hour stay on Bed #125", "a month's long stay in Room #351" (excluding all miscellaneous costs). Just like any restaurant or business has standard rates for particular goods and services.

The difference is that most restaurants and other businesses do publish these prices, while healthcare facilities do not.

Why is it advantageous for healthcare facilities to keep these prices shrouded in secrecy? Why have market forces not forced them to reveal these prices (in contrast to other industries)?

The US healthcare industry is perhaps exceptionally egregious. But I think it is also generally true in most countries that there tends to be much less price transparency in healthcare than most other industries. Why is this?

Please note that any successful explanation must explain why there is less price transparency in some industries (especially healthcare) than in others (real estate, airfare, food, cars, car repair, university tuition, etc.).

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This Washington Post report says most hospitals are ignoring the rule to post prices.

A quote...

Most U.S. hospitals are failing to comply with federal regulations requiring medical centers to post their prices online for patients to review, according to a new report by patient advocates.

The report, which surveyed the websites of 500 of the roughly 6,000 hospitals subject to the rule, found that 471 of the hospitals failed to fully post the prices they charge patients and the rates they have negotiated with insurers. The federal price transparency rules took effect Jan. 1, 2021.

In the article it says one hospital said they don't have standard prices. This means they might be trying price discrimination.

Some likely reasons why prices are hard to research...

  • the consumer does not have the knowledge needed to trade between price and quality so they do not demand price information
  • insured consumers don't care enough because they only worry about deductibles and copays
  • insured consumers have little incentive to help the insurance company get treated fairly by the treatment provider
  • some forms of health care treatment are not repeat purchases so the consumer does not invest the time to research prices. Even within a family or a circle of friends there may be no familiarity with a particular illness so there will be no history of what to expect in treatments and prices.
  • the consumer may place excessive reliance on a doctor to select treatment
  • illness is stressful so patients might not have the will and energy to deal with economizing
  • family members might not want to be seen to be economizing for the patient's treatment

In a market such as real estate, it is easier to identify the qualities and costs.

You said... "The US healthcare industry is perhaps exceptionally egregious. But I think it is also generally true in most countries that there tends to be much less price transparency in healthcare than most other industries". In single payer health care countries, the health care providers are transparent to the government so it is the government that decides how to trade between price and quality. Health care is a repeat purchase from the government's point of view and they employ medical experts so trading between price and quality is something they are familiar with.

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Obviously nursing homes are a.smaller market...

Large, liquid markets with frequent buying and selling of standard products have the most information.

Also, Zillow is bad, home assessors exist for a reason.

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