October 11, 2023
Access to information about the price and quality of health care items, services and providers can help consumers make more informed choices about their care; help payers build better provider networks, plan designs, and derive more value for their health care spend; and let providers know the costs of the care they provide and prescribe.
Through recent federal regulations and legislation, employer plans, payers, and hospitals have been required to make unprecedented amounts of payment and cost information available. Employers and other payers have worked in earnest to comply with these requirements, but the results are extremely large data sets and often not suitable for plan sponsor or consumer-facing direct comparison without substantial third-party analysis and have a number of other shortcomings. CMS also has large amounts of data on price and quality from hospitals, physicians, and other providers. Policymakers have expressed a hope that these data sets will empower plans and patients and help drive new innovations to help control increasing health care costs.
Employers have long invested in cost and quality navigation to help their employees and families find high-value providers and services. The new and emerging transparency requirements are expected to bolster that effort and improve a plan’s ability to curate, design, and provide meaningful, valuable health care coverages. Even with this progress, additional steps are needed to ensure date usability, comparability, and the incorporation of quality reporting in order to realize the potential of these transparency efforts.
- Patients and payers have the right to know out-of-pocket prices and prices for services within their plan. They should also be able to compare quality for these services;
- Whenever feasible and clinically appropriate, the price information should reflect the totality of a patient’s medical event, including physician charges, facility charges, medications, devices, and other services; providers should be accountable for establishing a price for the bundle of care;
- Patients and payers have the right to know which physicians and systems are providing higher quality care, as well as those that are not;
- Health care providers, suppliers and facilities should disclose in a patient-friendly format all relevant information about prices and quality for clinical services, prescription options as well as alternative options for care;
- CMS should require transparency of prices across all settings and provider types including facility fees for hospital-owned physician services and rates for out-of-network services at in-network facilities;
- HHS should continue to support efforts to streamline core measures of quality, outcomes, cost, efficiency and efficacy, balancing provider administrative burden with the provision of meaningful information to patients and payers; and
- HHS should continue to improve the methodology for reporting quality measures to enhance predictability and comparability.
- Department of Labor, Treasury, and HHS (the Departments) that may work in partnership for ERISA-based regulations should continue to reduce unnecessary duplication while improving the transparency requirements to drive uniformity, usability, and consistency, and develop useful quality standards for additional reporting/disclosure.
WHY IT MATTERS
- The total cost of health care is estimated to be $17,201 per capita in 2023, an expected increase of 6.0% over the prior year, according to Business Group on Health’s 2024 Large Employer Health Care Strategy Survey. As health care costs continue to rise, outpacing overall economic and wage growth, demand for price and quality information has never been higher.
- Transparency remains a key priority for employers, with 80% of those surveyed by the Business Group identifying service provider transparency as a top policy priority over the next 3-5 years. When asked about their top priorities for transparency, employers specified greater transparency for employees and plan members so they can make informed decisions about their health care.
- Better information on price and quality are also critical to building better provider networks and alternative delivery models. They are also important for providers who want to take on more financial risk and can influence provider decisions once they know the costs of care for their patients.
- Transparency helps people better understand the true costs of care and discern the relationship between quality and price and seek out alternatives if necessary.
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