HHS finalized new price transparency requirements at the end of 2019, prompting conversation among Doximity members. Amongst clinicians, it seems there is near-unanimous support for additional price transparency in health care, despite some concerns surrounding quality of care.
Dr. Jonathan Kaplan provided a summary of the new rules and argued they will potentially affect all physicians, even those not working in hospitals. For insurers, the new rules will require them to publicly post negotiated rates with hospitals and make available to their enrollees personalized out-of-pocket costs for all covered procedures.
For hospitals, the new rules will require public dissemination of their negotiated rates with insurance companies for facility fees, employed physician fees, medications, and supplies for 300 “shoppable services.”
The aim is to empower traditional market mechanisms to control patient costs for an array of services. An angioplasty, for example, or a CT scan can cost 10 times as much in the U.S. as in Holland. “For a free market to work at its best, there has to be free flow of information so people can make informed decisions," said one Florida emergency physician.
It is also hoped that such measures will reduce the prevalence of surprising – and sometimes shocking – out-of-pocket medical bills for patients. Currently, as many as 1 in 7 patients can expect a “surprise” bill, even if receiving care in-network.
We asked Doximity members: “Do you think we need hospital price transparency?” Not a single clinician found the status quo acceptable. A family medicine physician in Illinois called the current system’s lack of price transparency “unethical and inhumane.”
Nevertheless, four leading health care associations and three hospitals have filed suit against HHS, arguing the new rules inappropriately compel speech, and that HHS is exceeding its statutory authority. That said, the lawsuit’s plaintiffs would be unwise to expect support from clinicians.
“The lack of price transparency is the biggest legalized shell game in business,” an ophthalmologist said. As a result, “providers spend more time each day on inquiries about coverage than patient care.”
Psychiatrists seem especially engaged in the conversation. “No other industry in the world can get away with charging whatever they want without disclosing prices first,” agreed a pediatric psychiatrist. Another psychiatrist discussed discovering first-hand how challenging the system can be for patients. When shopping around for an MRI for her own care, she found large price differences between highly-regarded imaging centers. The experience reinforced her belief that “[w]e cannot remove ourselves from the financial burden our current healthcare system imposes on our patients.”
Additionally, an endocrinologist wondered what would be achieved by publicizing the rates insurance companies negotiate with providers. He observed, “The majority of patients and their families need to know two things: Is the hospital a network provider? What is their copay and deductible?” An internal medicine physician responded: “One payer may negotiate higher rates for provider services...than another payer. But patients pay those rates if they have not yet met their deductible. And most patients with high-deductible plans don’t meet the deductible.”
Overall, the Doximity community appeared to agree that additional transparency measures would encourage a drop in unreasonable hospital costs to patients. As a Michigan nephrologist put it, “We need price transparency to expose the many factors that cause present-day unreasonable hospitable costs.”
Some observers, though, warn that these measures may actually increase the out-of-pocket price for certain procedures, since providers will be better informed about what third-party payers are willing to pay. After all, “cost” and “price” are different things.
Two surgeons highlighted how complicated the pricing issue can be in the current system. Quality of care delivered, variances in insurance coverage, referrals out of network, and myriad other factors can all affect the cost of care. And all of those factors can affect the final price for patients.
“Treatment of healthcare as a commodity is worrisome and naive in my opinion,” said a general surgeon in Wisconsin, who also worried about “strip mall medicine.” A Georgia neurosurgeon agreed the system needs to be more transparent but pointed out that going “completely free market" is not an option. “Right now the insured sick pay for all of healthcare. As physicians we are caught in the middle.”
A psychiatrist in Florida agreed that encouraging transparency in a way that accounts for the quality of care would empower patients to find “the best possible care at the lowest possible price.” But, she added, “Doctors have to have a major say in what constitutes ‘quality of care.’ Which, if you haven’t noticed, they don’t now.”
Promoting price transparency for patients while simultaneously safeguarding against a race to the bottom (wherein we favor price over quality) will be the challenge. That said, those individuals charged with delivering care seem prepared to advocate for patients — but are hospital administrators willing to listen?
What do you think? Share your thoughts and opinions in the comments!