You may have seen this NY Times article a couple weeks ago about a new law requiring hospitals to post prices. The law was initially included in the Unaffordable Care Act but not put into action until the Trump administration.
The article highlights how the information posted by the hospitals is inadequate and not actionable. All true, but you have to start somewhere.
Posting prices is a step in the right direction…but not enough
By requiring hospitals to post their prices, we finally have a chance to shed some light on how opaque their pricing is.
Hospitals have resisted posting prices for years because they know the prices on their chargemaster (menu of services) is simply a game of chicken they play with insurance companies. No one expects to pay those chargemaster rates. It’s only a dollar figure the hospital submits to the insurer before the hospital and insurance company negotiate and agree to a lower rate. That’s why the chargemaster rates are so high. The hospital doesn’t want to accidentally start the bidding too low.
That’s also why the prices hospitals post are so irrelevant. They’re not meant to reflect the cost of services. But that’s ok. With more consumer awareness of the nonsensical pricing posted by hospitals, comes increased pressure to make the pricing more accurate.
However, at this point, the hospital has no reason to make the pricing actionable other than meeting the minimum requirements of the law. They need a reason for greater buy-in. Something in return.
They need to use a Price Estimator like this surgery center. In this scenario, the consumer chooses procedures or services of interest from a menu. But before they see the pricing, they have to enter their contact info.
The consumer gets pricing information instantly and automatically and the healthcare provider receives the consumers’ contact info for future remarketing. Both sides win!
With the ability to provide consumers with pricing information they’re so desperately searching for, hospitals can generate a huge consumer database in the process and provide an unprecedented level of customer service. Sounds like price transCAREncy to me!