Healthcare Revenue Cycle Management, ICD-10, Claims Reimbursement, Medicare, Medicaid

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Price Transparency Laws Exclude Adequate Price Information

By Jacqueline DiChiara

- Pricing Transparency laws paint a “bleak picture" with “much work to be done,” according to the third annual Catalyst for Payment Reform (CPR) – Health Care Incentives Improvement Institute (HCI) Report Card on State Transparency Laws. Most states are far from being up to transparency par, according to new findings.

pricing transparency

According to the report card from Suzanne Delbanco, PhD, Executive Director, Catalyst for Payment Reform, and Francois de Brantes, MS, MBA, Executive Director, Health Care Incentives Improvement Institute, although legislative sessions are active and proposed bills are underway, many proposed bills will fail to pass due to pressure from those healthcare providers and healthcare payers reaping benefits from price opacity. Such pressure stems from illegitimate arguments about price as a trade secret or the likelihood of a state law on price transparency defying contracted terms that legislators and the media often turn a blind eye to.

“A crucial point for legislators and the media is that states who take efforts to ensure price transparency seriously have successfully brushed aside the spurious arguments, and not one plan or provider has sought a challenge in the nation’s highest court,” say Delbanco and Brantes. “Many of the arguments against price transparency – including that it leads to higher prices and breaks laws – are toothless,” they add.

States were reviewed regarding whether or not they had passed laws or regulations mandating that healthcare price information be publically available. Additionally, the report card analyzes the actionable results of these laws through examination of public websites’ available price information and the utilization of all-payer claims databases (APCDs).

New Hampshire and Massachusetts are notable states regarding price transparency laws, explain Delbanco and Brantes. Almost all states – 90 percent – failed to provide adequate price information to consumers, according to the report card. New Hampshire received the only “A” grade for 2015 price transparency laws. Colorado and Maine both received “B” grades. Vermont and Virginia earned “C’s.” All other remaining states failed. Resultantly, there was not much progress made since last year’s report card.

New Hampshire has responded favorably to the positive news. “We are pleased that we have been able to bring increased transparency to health care costs in New Hampshire,” states New Hampshire Insurance Commissioner Roger Sevigny. “We will continue to look for ways to help Granite Staters navigate their health insurance plans and make informed choices,” he says. "We are proud of the national recognition the site has received, but we’re even prouder that we have been able to help so many New Hampshire residents save money and better understand the complexities of health care costs."

There are other states that serve as models for others to follow, say Delbanco and Brantes. “One state returned to a high score this year after a brief hiatus due to an inactive website last year: New Hampshire. Its rebound shows that even small states with few resources can develop and maintain a useful and consumer-friendly website on health care prices,” Delbanco and Brantes state. “Conversely, Massachusetts’ grade dropped precipitously due to shutting down MyHealthCareOptions, the website that had publicly posted price information.”

Other states are working towards a stronger objective. “States like Connecticut and New York are still assembling their all-payer claims databases and working on consumer-facing websites,” confirms Delbanco and Brantes. “Maryland is in the process of embarking on a significant effort to publish prices on health care services, and Washington State just enacted new laws. We expect continued progress, even if at a slow pace,” they add.

States are more openly recognizing a lack of price transparency creates bumps in the revenue cycle road, the report confirms. Effective price transparency plans must be comprehensible and able to be beneficially and quickly acted upon. Although legal hiccups may complicate future price transparency endeavors, states can address such problems via legislation that bans healthcare price obscurity and litigation, says the report.

It is hopeful future reports will not be "bleak" but will show tangible progression so the healthcare industry can financially advance accordingly.

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