The Best Bets from Washington Consumers' Checkbook
Transcript for:
The Best Bets from Washington Consumers' Checkbook MR. MARK MCDONALD
12:41:32
Welcome back. You're listening to "The Kojo Nnamdi Show." I'm WAMU 88.5's program director, Mark McDonald. And we're talking about consumer issues for the next few minutes with Douglas -- with Kevin Brasler, who's the executive editor of Washington Consumers' Checkbook, and with Robert Krughoff, the president of the Washington Consumers' Checkbook. Gentlemen, welcome. First of all, Kevin, tell us about the magazine itself. It seems to me it's kind of taking off pretty substantially.
MR. KEVIN BRASLER
12:42:02
Well, we'd like it to be. It's -- we've been publishing Checkbook here in the Washington area since 1976. I say we, meaning that Robert's been doing it since then. I was four when it started. But we've been publishing Checkbook here. It's a nonprofit consumer publication. It's kind of like Consumer Reports, except, where they mainly rate products, we rate local services.
MR. KEVIN BRASLER
12:42:25
So auto repair shops, veterinarians, health care providers, home improvement companies, things like that. Again, nonprofit, supported just by our members, don't -- we don't take advertising, and we don't take any support from the companies we rate.
MCDONALD
12:42:37
Where does your income come from?
BRASLER
12:42:39
It's coming from sales of our -- of subscriptions to the magazine...
MCDONALD
12:42:42
Subscriptions.
BRASLER
12:42:43
...and at Checkbook.org, which is our website.
MCDONALD
12:42:45
So you've got 10 categories of services in the latest issue, ranging from health clubs to hospitals. Now, let's start with veterinary services because I know that's an area close to a lot of hearts around here. Now, how do we go about judging which vets to go to in an emergency or in a regular visit?
MR. ROBERT KRUGHOFF
12:43:02
Well, unfortunately, we can't survey the pets, but we can survey the pet owners. And we've surveyed more than 10,000 pet owners for their ratings of veterinary services. And we've got ratings of 231 different local veterinarians.
MR. ROBERT KRUGHOFF
12:43:20
And, in addition to the quality ratings -- and there's quite a lot of variation in quality, just in terms of the overall care and service that people get, you know, whether the vet gives them good advice, whether the vet talks about their treatment options and things like that. We also do price comparisons, where we -- and we do this in most of the service fields we look at, basically undercover price shopping.
MCDONALD
12:43:45
Mm hmm.
KRUGHOFF
12:43:46
And in the case of vets, we find dramatic differences. For instance, I'm looking here at a -- one example, a 30-pound dog, 6 months old. Neutering that dog, prices range from $186 to $697. That's for exactly the same procedure. And, again and again, we find these dramatic differences in price.
MCDONALD
12:44:11
Now, would they be places in the same sort of area, or is it a geographic thing?
KRUGHOFF
12:44:15
In many cases, they're really quite near each other and certainly would be convenient for most people to go either place. And then people say, yeah, well, I want to get really good care for my pet. We find no relation between quality and price. So some of the lowest price places -- in fact, there is likely as not to have the lowest rate...
MCDONALD
12:44:34
You said no relation at all?
KRUGHOFF
12:44:35
No relation whatsoever between quality and price.
MCDONALD
12:44:38
Right.
KRUGHOFF
12:44:38
The lowest priced places actually, on average, score somewhat higher in terms of the quality of service, quality of advice and so on.
MCDONALD
12:44:49
Now, could that be because the feedback is people who go to those lower priced places who are very knowledgeable about the area and want to increase their value? In other words, there -- you know, there's buy-in from them for the service from the cheaper places?
KRUGHOFF
12:45:02
Well, I mean, I think, in many cases, these -- you know, a vet survives in substantial part based on customer satisfaction. And so these places, they --you notice they're not doing a lot of heavy advertising and so on, and these places have to do a good job to do well. And then, I guess, some of them have just chosen -- it's quite surprising, but we find this in field after field we look at, that the quality has nothing to do with price.
KRUGHOFF
12:45:32
We find that in auto repair shops. We find it with plumbers. And yet people assume that paying more does better, you know, gets you better service. And we find when we do quite rigorous evaluations of the quality of work they do and the quality of care they give that there's no relationship between price and quality, quite a striking fact.
MCDONALD
12:45:52
Now, is that true of other subjects, or is that confined to veterinary practices?
BRASLER
12:45:55
Yeah. Almost every subject we cover, we find just the companies that rate very well on the quality side are just as likely to offer low prices as the companies that don't rate very well on the quality side. And it's really one of the reasons Robert started Checkbook. You would think that -- you know, there's what's really a myth that, well, you know, if you want more, you have to pay more.
BRASLER
12:46:16
To get good service, you have to pay for it. And economists would tell you, well, that's the way the market should work. But when it comes to local services, we find, again and again, that's just not the case. The market, in some ways with local services, is very broken.
KRUGHOFF
12:46:31
And it's hard for people to shop for services, shop for price, although it's not so hard to shop for veterinary prices for routine things like, you know, neutering a pet or spaying a pet or something like that or...
MCDONALD
12:46:44
Right.
KRUGHOFF
12:46:45
...cleaning the teeth and things like that. You actually can shop. And we've found that vets that do well on those things, which you could easily shop in terms of price, also do well on other things as well in terms of price, things that you couldn't know in advance. And people say, well, OK, but it's just customer ratings. You know, that's not enough. But we look at auto repair shops, for instance, where we actually check on -- we're able, in some states, to actually check on the quality of the repairs they do in terms of, for instance, the car fails an inspection, an emissions inspection.
KRUGHOFF
12:47:19
And then we know what shop they went to, and then they go back. And the state actually has a record of who did the repairs and how successful they were. And the shops that were rated high by customers did -- actually did better in terms of getting the repairs done right 'cause we ask the customer, was the repair done right? And then we look at the records, and the same thing is the repair isn't done right at some of these low-rated shops.
MCDONALD
12:47:44
Mm hmm.
KRUGHOFF
12:47:44
And yet price had nothing to do with quality.
MCDONALD
12:47:47
You can get great consumer advice from either Robert or Kevin or both, 800-433-8850, or the email address is kojo@wamu.org. One of the things that I've been forced into, guys, is pet insurance, and I wondered if you had thoughts on, you know, getting value for money there.
BRASLER
12:48:08
We looked at it a little bit. And it's a -- our general advice is buy insurance for things that -- you want to insure yourself against instances where you would have a financial catastrophe should -- without it. So, for example, you want to insure your home against it burning to the ground. You want to insure your car not -- maybe not so much for the value of the car, but for liability reasons. You may want to insure your life to protect your family in case you die. Vet insurance is one of those things where some pet owners could easily rack up enough...
MCDONALD
12:48:44
Oh, yeah.
BRASLER
12:48:44
...vet bills to make it financially difficult upon themselves. The problem with vet insurance -- with veterinary insurance is that the coverage that you get for the cost is rarely worth buying it.
MCDONALD
12:48:58
Right. Well, I've had this experience.
BRASLER
12:49:00
Right.
MCDONALD
12:49:00
And I'm guessing from what you're saying that, you know, that the ideal thing would be to buy -- you know, for instance, if the breed of dog was predisposed to cancer, and that could be a $5,000, $10,000, $20,000 bill. But aren't those the things that are very hard to get insurance for?
BRASLER
12:49:17
Yeah. I mean, there are some congenital conditions that veterinary insurance just won't cover, and we couldn't find any veterinary insurance policy that covers pre-existing conditions. So if you're thinking, well, last year, Fido had enormous medical bills, I'm going to ensure him this year, that's not going to work. The other problem with veterinary insurance is that it doesn't cover normal things like spaying and neutering and regular visits to the vet.
BRASLER
12:49:41
It's only covering, you know, the things you want -- might want insurance for, like broken bones and cancer and same with things like that. The problem is is that, you know, for -- the premium might be four or $500 a year. What it pays out, we found, is usually about half of what the average vet charges for those things.
MCDONALD
12:49:58
Right.
BRASLER
12:49:59
So the amount of money you're still going to pay out of pocket is still a tremendous amount of money.
MCDONALD
12:50:03
Is some of that because people forget to put the claims in for small items?
BRASLER
12:50:07
Yeah. Well, that's another problem sometimes. But another problem is that, you know, when you buy insurance, a lot of what you're buying is going to profit for the insurance company, administrative cost, the handling claims, things like that. You're generally better off just saving money to pay large vet bills.
KRUGHOFF
12:50:25
I think the thing you really have to ask yourself is, you know, would I spend $10,000 on my pet if it came to that? And if I would, could I absorb that $10,000 in the very unlikely event that it will come to pass? Because that's really what you should be buying insurance against, is something catastrophic like that.
MCDONALD
12:50:45
Mm.
KRUGHOFF
12:50:46
Now, for some people, even $1,000 bill would be catastrophic, and then you may want insurance, you know, that will cover you for those routine things. But you certainly want -- the focus of insurance should be to cover whatever you would consider a catastrophe.
MCDONALD
12:51:03
Robert Krughoff is president of the Washington Consumers' Checkbook. Kevin Brasler is executive editor of the Washington Consumers' Checkbook. You can call them at 1-800-433-8850. Send us an email at kojo@wamu.org. Guys, let's move on to people. And I know you've done a lot of research into hospital care, and one of the alarming things for me was that hospital care can be bad for your health. Robert?
KRUGHOFF
12:51:29
Yeah. I mean, hospitals are dangerous places, and it's not surprising that they would be dangerous places. You're going in some place where they're, you know, taking a knife to you, and they're injecting dangerous chemicals into your body, et cetera. So if something goes wrong, it can be really bad, and things do go wrong very often. So the first thing you want to do is be sure. Do I have to go to a hospital? Do I have to have this procedure?
KRUGHOFF
12:51:54
What are my options? And explore that very carefully with your physician or physicians. Get second opinions. So really try to be very careful about going in at all.
MCDONALD
12:52:07
Mm hmm.
KRUGHOFF
12:52:08
But then, we do find big differences in these hospitals. We -- this is a case where our ratings of hospitals, a big part of that, is based on analyzing 30 million hospital discharge records and calculating the risk-adjusted death rates, in other words, the death rates in these different hospitals after you adjust for the age of the patients, the type of condition they had, the type of secondary conditions they have, et cetera. And when you adjust for all that, there are some hospitals that do, you know, substantially better than other hospitals in terms of death rates.
MCDONALD
12:52:41
But there's a statistic here. Twelve out of every 100 patients die within 30 days of admission. But I guess I'm confused about -- I mean, that's just presumably, you know, people who have been admitted to hospital with critical complaints in the first place.
KRUGHOFF
12:52:53
Yes. No, I'm sorry. That's says for a select set of cases.
MCDONALD
12:52:58
Right.
KRUGHOFF
12:52:58
So when we were comparing the death rates, we were comparing death rates for people with heart failure, with heart attacks, people with stroke and things like that…
MCDONALD
12:53:08
OK. Well, more like success rates then, really, or failure rates. Yeah.
KRUGHOFF
12:53:11
Well, success or failure, yeah, but failure rates among people who had serious conditions. But having done that, we're finding that within that category of cases, there will be some hospitals that will have an 8 percent death rate, and others will have a 12 percent death rate right in the Washington area. Well, that's a big enough difference. You know, that's a four-percentage-point-chance-of-dying-in-a-hospital difference.
KRUGHOFF
12:53:35
I mean, if -- and I would say if I were choosing a hotel and somebody said, we've got a 4 percent chance of dying in this hotel next week, that would be a pretty upsetting and shocking fact. And yet you should be looking at those kinds of differences in hospitals as well.
MCDONALD
12:53:50
Do hospitals with medical school affiliations get better ratings?
KRUGHOFF
12:53:55
Yes. In general, they do, on average, get better ratings.
MCDONALD
12:54:01
OK. And when you did this evaluation exactly, you know, you evaluated the acute-care hospitals. How did you go about doing that?
KRUGHOFF
12:54:08
Well, we look at death rates, as I say, these risk-adjusted death rates.
MCDONALD
12:54:12
Yeah.
KRUGHOFF
12:54:13
We actually survey doctors to ask them how they would rate the different hospitals for high-risk surgery or whatever. We look at patient survey ratings. We have that kind of information for basically all the hospitals. We look at reports that are put together, where the hospitals report on what they're doing to prevent infections, et cetera, et cetera.
MCDONALD
12:54:42
Let's take a call from --actually, is that ready? It says from Washington, D.C. I don't see a name, but there's somebody there. Hello. You're on the air. Oh. Hello, is there anybody there?
UNIDENTIFIED FEMALE
12:54:55
I'm waiting for the lady to give me the telephone number for Washington Consumer's Checkbook.
MCDONALD
12:55:00
Oh, OK. We'll give you a telephone number right now for Washington Consumer's Checkbook.
BRASLER
12:55:03
Yeah. It's 202-347-7283.
MCDONALD
12:55:08
202-347-7283.
KRUGHOFF
12:55:11
And Checkbook.org is the way most people reach us.
MCDONALD
12:55:14
Checkbook.org.
KRUGHOFF
12:55:16
That's our website.
MCDONALD
12:55:17
Let's go from -- as we used to say, now, for something completely different. This is an email from Sally in Silver Spring, who asks, "My husband and I both work for nonprofits, don't have a lot of money, two kids, no extra time. I finally decided to pay someone to clean our house to ensure it actually happens." -- I know the feeling -- "We've been debating whether to go with an individual recommended on a neighborhood listserv or going with a home cleaning service. What do you think?"
BRASLER
12:55:41
Yeah, well, we -- in our current issue, we covered housecleaning services. When we ask consumers to rate housecleaning services and also rate individuals if they employed individuals, we found that, you know, some housecleaning services rated quite highly, but on average, individuals -- it looks like their customers -- consumers who employ individuals are about twice as more likely to be satisfied than those who employ services.
BRASLER
12:56:08
The problem, of course, is that when you hire a company, you don't have to deal with things like making sure you have the proper documentation from workers. You don't have to worry about paying taxes and withholding certain taxes and making sure you have workman's comp insurance policy in place and those other things that the service is taking care of those things.
MCDONALD
12:56:23
Right.
BRASLER
12:56:28
So while consumers are usually more satisfied, on average, with individuals versus companies, they're just -- the responsibilities usually cause a lot of people to shy away and use companies.
MCDONALD
12:56:38
OK. Moving on quickly to health and fitness, and you found, I think -- well, did you find a difference? I know you didn't with the vets. You didn't find a difference in quality, even though the prices were low and high. Is there a difference in quality between a variable price in the health care arena?
KRUGHOFF
12:56:57
Well, each of these fitness clubs are -- and sports clubs and so on has its own personality, so one person's quality may be quite different from another. But in terms of just cleanliness of equipment and availability of classes and help in these classes and good instruction and stuff like that, we found that there were some low-priced fitness and health clubs that actually did very well, but probably more of a correlation between price and quality with these fitness clubs than there is in most of the services we look at.
KRUGHOFF
12:57:34
On the other hand, the prices are quite substantially different. For instance, if you just wanted fitness equipment and group exercise classes within Falls Church, Va., for instance, we found the cost of that for a year, for a single person, would range from $279 all the way up to $1,050.
MCDONALD
12:57:57
Wow. There's a lot of difference. Guys, thanks for joining us. Kevin Brasler, the executive editor of Washington Consumer's Checkbook and Robert Krughoff, the president of Washington Consumer's Checkbook, thanks very much for joining us. It's been a lot of fun.
BRASLER
12:58:08
Thank you.
MCDONALD
12:58:08
Join us for the next hour of "Kojo." I'm Mark McDonald, sitting in for Kojo Nnamdi today.
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