Price transparency: Where is it headed?
The proliferation of medical options, the general consumerization of healthcare and higher out-of-pocket costs for patients put a greater demand on providers to be more transparent about prices and costs to patients.
However, only one-quarter of patients receive pre-treatment estimates from their providers, even though 63 percent said they were interested in knowing the full cost of the care they received, according to the credit giant TransUnion. Consumers overall rated receiving upfront price estimates nearly as important as receiving an accurate medical diagnosis.
"Most...countries have fee schedules and modest cost-sharing upon use of services, and often available prices, but not so in the United States," Betsy Imholz, director of special projects for Consumers Union, told FierceHealthFinance during an exclusive interview. Given that most insurers negotiate provider charges separately, Imholz noted that the result is "price discrimination" where the same service is sold for different prices--often vastly different prices.
At the same time, Imholz cited research from the National Institute for Health Care Reform that concluded up to one-third of healthcare services are considered "shoppable"--such as ambulatory care procedures, lab tests, physician visits, imaging and even extensive elective surgeries like knee or hip replacements.
Yet "most folks don't know that price disparity exists," Michael S. O'Neil, senior vice president for the Healthcare Bluebook, a Brentwood, Tennessee-based company that provides market price listings for a variety of healthcare services throughout the country, told FierceHealthFinance in an exclusive interview. He noted that health plans encourage most insured patients to use in-network providers, but even those providers can have pricing variations of 300 percent or more.
Meanwhile, most price transparency efforts are piecemeal at best and few provide comprehensive data for any given market or region. Imholz noted that there are multiple price transparency efforts underway in the U.S., oftentimes several within the same state. "It's a crazy quilt," she said.
There are also private sector providers and businesses trying to capitalize on the demand for healthcare price transparency. But those efforts remain a long way from creating transparency throughout the continuum of care.
In this special report, FierceHealthFinance takes a look at successful price transparency efforts and what the future holds for the nationwide initiative.