Speak with an adviser 916.900.2998

Start Here
Benefits Advising

Will the “new” hospital transparency rule help lower the cost of healthcare in America?

In my daily conversations with employers about what can be done to lower the cost of healthcare, the “new” transparency rule that kicked in January 1st for hospitals often comes up. We work with some hospital associations around the country and one shared with us recently that their average hospital member has over 150 prices for each procedure that they perform. Could there be an opportunity to improve the cost of care in this mess?

First off, it is not new. It was part of the original ACA and someone finally decided to enforce it. That aside, hospitals have been required to publish the negotiated prices that they have on 300 procedures or so with the thought that it could help consumers negotiate what they pay.

A recent article in the Wall Street Journal detailed some of what we now have access to:

Sutter Hospital in Modesto, CA charges anywhere from $89,752 to $515,697 for a billing code that represents a cardiac procedure. The difference is determined by the insurance that the patient has.

Sutter Hospital in Van Ness, CA charges $16,922 to $29,000 for a C-Section. This also varies based upon the insurance that the patient has.

Will this help consumers? Likely not immediately if they are not a cash payor. The price that the facility charges will continue to be based upon the agreement with the patient’s insurer and therein lies the challenge. Hospital pricing often has little to do with the actual cost or value of a service and we have trained people to consume in terms of their copays and deductibles rather than real cost.

So, while any added transparency in healthcare is a step in the right direction, we need to enact changes in the system that will empower insured Americans to be good consumers and build plans that reward them for making good buying decisions with the information.

Is it crazy to think that a facility could have a published price for a procedure that allows a free market and competition to take shape?

Leave a Reply

Your email address will not be published. Required fields are marked *

Start Here