The State of Price Transparency in Healthcare 2019

Since January 1, 2019, hospitals are required to post their price lists online, in the interest of greater price transparency. But while CMS has urged hospitals to publish those prices in a consumer-friendly way, most patients may find the data rather mind-boggling. Many hospitals publish complex spreadsheets filled with unfamiliar billing codes instead of plain English.

For the typical consumer the postings don’t educate and illuminate. They just frustrate and alienate. An article in the New York Times described the data as “incomprehensible and unusable” by patients. The headline of that article sums it up by saying “Hospitals Must Now Post Prices. But It May Take a Brain Surgeon to Decipher Them.”

Helping Patients Understand Pricing

Billing codes make is difficult or virtually impossible for consumers to compare prices and arrive at useful healthcare or financial conclusions. The New York Times cited the example of a $42, 569 charge posted by a hospital for a procedure identified as  “HC PTC CLOS PAT DUCT ART.” Another commonly-shared concern is that the posted prices do not necessarily reflect the actual costs that patients end up responsible for paying. That’s because hospitals typically use these “list prices” as merely a starting point when negotiating with insurance companies. The actual cost to the patient after negotiation may be drastically different.

A Push for Greater Clarity

To help alleviate the confusion, California has its own transparency guidelines that hospitals must follow. The state requires hospitals to post prices of the 25 most common procedures, in a format that is easy to understand. Then all of that data, gathered from all California hospitals, is posted on one centralized platform that is easy-to-access and managed by the state. But providing that kind of information still isn’t an ideal remedy because it doesn’t help patients develop a more engaged, trusting, and direct relationship with healthcare providers.

Patient Pricing Estimator Tools

One user-friendly, consumer-centric way to provide transparency is by adding a price estimator tool to a secure patient information portal. Calculate hospital charges or private practice costs, including insurance copayments and deductibles. At St. Clair Hospital in Pittsburgh, for example, vendor-provided cost estimator software enhanced the patient experience while lowering front office call volume so that staff could focus on other priorities. A well-designed digital platform can also include a way for patients and providers to verify insurance eligibility before they incur any expenses. There are secure HIPAA-compliant tools that can support over 800 different payers, including private insurance companies as well as Medicare. Eligibility can be confirmed by front office staff instantly, even prior to a patent’s appointment.

Fringe Benefits

Another advantage of this kind of solution is that it can help ensure regulatory compliance with the 2019 pricing transparency rule or other applicable state laws. A sophisticated digital platform also facilitates more accurate internal reporting, to help hospitals or practices with financial projections and administrative analysis. Giving patients more pricing insight can minimize defaults, too, while accelerating the payment cycle. Best of all, open and transparent communication improves the provider/patient relationship, which always translates into better quality of care. That is, after all, the ultimate goal of the new price disclosure mandate.