- With more individuals covered by a health insurance plan and high-deductible arrangements on the rise, patients and beneficiaries are increasingly demanding more healthcare transparency when it comes to costs of services and out-of-pocket expenses.
In response to this call for action, Representatives Michael Burgess (R-TX), MD, and Gene Green (D-TX) have introduced the Healthcare Price Transparency Promotion Act of 2016, which would require hospitals and health insurers to provide healthcare cost information to patients and beneficiaries before the point of care.
Burgess stated in a joint press release on his website that the bill was designed to reduce healthcare costs by allowing individuals to compare costs and fostering competition between providers.
“The fact that patients rarely know what healthcare services cost until after they've received them and the wide variety in pricing, make the healthcare market uniquely difficult to navigate,” stated Representative Green.
“Greater transparency around prices of healthcare services will enable patients and families to choose lower-cost, high-value care and promote competition in the market. This bill is an important first step towards empowering patients and advancing value-based care.”
The bill would amend the Social Security Act by mandating states to develop and maintain laws requiring “disclosure of information on hospital charges, to make such information available to the public, and to provide individuals with information about estimated out-of-pocket costs for healthcare services.”
Under the act, hospitals would need to provide timely access to healthcare cost information associated with charges for certain inpatient and outpatient services as determined by the state.
Similarly, health insurers would be required to give beneficiaries a statement of the estimated out-of-pocket costs for specific healthcare items and services within a certain period of time upon request.
The bill also stipulates that the Agency for Healthcare Research and Quality would conduct research in the following areas:
• The types of healthcare pricing and out-of-pocket costs information that individuals would find useful for deciding on where, when, and from whom to receive care;
• How the useful information differs for individuals based on their health benefits coverage and what type of coverage they have;
• And methods for how to share healthcare cost information in a timely and convenient manner.
Through healthcare transparency research, Burgess and Green intend to help individuals gain more control over their healthcare decisions.
“At no point in the course of care should patients ever be left in the dark, lacking critical information to make the most informed decision about treatment options, particularly when it comes to cost,” said Representative Burgess. “Our current health insurance system insulates patients from the true cost of health services. This legislation takes the first step towards ensuring true price transparency in the healthcare market.”
Additionally, the American Hospital Association (AHA) recently penned a letter of support for the healthcare transparency bill.
“Consumers deserve meaningful information about the price of their hospital care, and hospital leaders are as committed to sharing price information as they are to sharing information about quality,” wrote Thomas Nickels, AHA’s Executive Vice President. “The AHA believes that states, working with their state hospital associations, are the best source for sharing meaningful pricing data.”
The legislation would build on existing state laws that mandate healthcare price transparency and it expands the federal regulation’s authority to cover health insurers, reported the AHA.
The AHA also commended the lawmakers for promoting more research related to healthcare costs and how prices affect healthcare decision-making.
“This is valuable because, while we have research on the kind of information consumers want about healthcare quality, we know less about what they might want to know about pricing,” stated Nickels.
While the Affordable Care Act has multiple price transparency provisions, some have criticized the law for not implementing more efficient regulations that provide consumers with healthcare cost information.
Last year, the Pioneer Institute Hospital released a policy brief that stated healthcare price transparency laws lack standardization, which makes it harder for hospitals to readily provide price information and harder for individuals to access and understand it.
According to the policy brief, healthcare transparency laws drastically differ from state to state. For example, California requires hospitals to make a master charge list publicly available and provide common costs upon request whereas, Texas-based hospitals must provide estimates at or before a patient’s admittance.
Even though each law is significantly different, the states are all covered by the Affordable Care Act’s healthcare transparency requirements.
Through the Health Care Transparency Promotion Act of 2016, lawmakers intend to help states define when and how healthcare providers and insurers provide price information. The bill is designed to empower more individuals to save healthcare dollars while still selecting the highest quality care.