Consumers often undertake significant research and price comparisons when buying an expensive item. Yet, when it comes to healthcare, comparison shopping has historically been nonexistent, partly due to a lack of cost transparency. Some providers treated requests for written estimates as a nuisance. Others could not provide an accurate estimate due to coordination issues with insurance companies and other key players in the industry.
Healthcare Transparency Importance
Transparency can provide benefits to everyone, including higher quality medical care, improved patient outcomes, lower provider operating costs, increased cost control in healthcare insurance, and a more efficient administrative process.
Transparency for Consumers
Patients often face unpredictably high healthcare costs. Transparency can supply information about quality and price, simplifying the process of comparing providers and choosing the best option. Insurance providers and health systems are beginning to offer online tools for this purpose.
At the same time, Health Savings Accounts (HSAs), Flexible Savings Accounts (FSAs), and Health Reimbursement Accounts (HRAs) can also help patients manage their healthcare costs and become more involved in their healthcare decisions.
Transparency for Physicians
In the traditional healthcare model, physicians have no financial responsibility for the quality of care their referral partners deliver. With more emphasis on accountability, physicians are becoming liable for not only the quality of services they provide but also for those given by their referral partners. As a result, physicians, particularly those in value-based contracts, now want to know which potential referral partners have the best patient outcomes.
Transparency Between Payers and Providers
The shift from a fee-for-service reimbursement system to value-based care – a delivery model in which healthcare providers are paid based on patient outcomes – requires payers and providers to work as allies rather than adversaries. Previously, both sides closely guarded proprietary information to gain the upper hand during price negotiations. Transparency means providing access to previously withheld information and jointly tracking agreed-upon quality, efficiency, and patient satisfaction metrics.
Transparency for Healthcare Organizations
For hospitals and large medical practices, transparency makes information about costs, patient outcomes, and quality initiatives more accessible. It also involves improving communication and collaboration between different departments within the organization. However, determining costs and understanding colleagues’ performance can be challenging. As such, hospitals and practices are investing in new technologies and team building.
The Push for More Healthcare Transparency
In the past, many patients did not learn the actual cost of a doctor’s visit or medical procedure until they received their bill afterward. Then came healthcare consumerism and, ultimately, the healthcare transparency so important today. Healthcare consumerism is a movement designed to make healthcare service delivery more efficient and cost-effective. Healthcare consumerism puts greater purchasing power and decision-making in the hands of patients. Then, the patients may pressure healthcare service providers to deliver the highest quality at the lowest price. Some medical providers now provide pricing and other information to consumers.
President Trump signed Executive Order 13877 in June 2019 to help increase healthcare transparency. The executive order mandated that healthcare providers publish the cost of medical procedures before consumers receive them. The Biden Administration continued these pursuits with a 2021 interim final rule that allows for the following provisions:
- Ban surprise billing for emergency services.
- Ban high out-of-network cost-sharing for emergency and non-emergency services.
- Ban out-of-network charges for ancillary care at an in-network facility in all circumstances..
- Ban other out-of-network charges without advance notice.
Bipartisan Government Support
From a political perspective, the high cost of healthcare is a bipartisan issue. As recently as December 2023, the House passed new legislation called the “Lower Costs, More Transparency Act,” which “…requires health care providers and insurers to disclose certain information about health care costs. It also establishes requirements for certain payment methodologies under Medicare and Medicaid and extends several public health programs.”
Despite bipartisan support in the House, this act has received strong objections from organizations like the American Hospital Association and the Association of American Medical Colleges.
Greater Healthcare Transparency
Recent efforts by elected officials and the move to healthcare consumerism represent a major cultural shift. Everyone involved wants the same outcome: higher-quality medical care at a lower cost. More emphasis on transparency and healthcare consumerism might just be the combination that gets us there.
For 40 years, DataPath has been a pivotal force in the employee benefits, financial services, and insurance industries. The company’s flagship DataPath Summit platform offers an integrated solution for managing CDH, HSA, Well-Being, COBRA, and Billing. Through its partnership with Accelergent Growth Solutions, DataPath also offers expert BPO services, automation, outsourced customer service, and award-winning marketing services.
