On this episode of the podcast, Terry and Bob discuss the recent rules from Health and Humans Services to demand healthcare price transparency from both providers and insurers. As patients know all too well, finding out how much healthcare costs is usually difficult-to-impossible. Asking your provider or insurer how much treatments will cost is often met with ignorance or even derision. As a result, healthcare prices are way higher than they’d be in a competitive market where patients can easily seek out cheaper care.
Terry interviews Cynthia Fisher, founder and chairman of PatientRightsAdvocate.org, a patient advocate who has championed price transparency reforms. She explains how the new price transparency rules will create a long-overdue functioning healthcare market where patients can shop for lower-priced care and coverage.
Cynthia explains how the hospital rule, which takes effect in January, requires hospitals to reveal their vastly lower cash prices, which are hidden for nearly all patients that don’t go in with a wad of bills, as well as their dramatically lower negotiated rates that are also secret. When technology companies aggregate these real prices, patients will be able to compare costs and value like they currently compare hotels on Priceline. What a difference from today’s experience where there’s a Chinese wall between patients and prices.
The recently finalized health insurance transparency rule will extend these benefits to healthcare coverage, requiring insurers to disclose the out of pocket costs to patients for treatments and prescription drugs. This will allow patients to get a clear picture of their costs before getting care and choosing coverage. This information will also allow patients to see how their plans stacks up against ones from competing insurers.
Cynthia highlights how this price information will flip the current power imbalance in healthcare to put patients first. She uses the analogy of the airline industry, which used to have similarly hidden prices and sky-high costs before President Jimmy Carter introduced transparency. Since then, fliers have been empowered to compare and purchase their own flights, reducing average airfares by half. She points out that air travel, like healthcare, is complicated, yet airlines can still manage to offer clear, guaranteed prices.
Price transparency will do more than just lower healthcare prices, argues Cynthia. It will also increase healthcare quality, expose overbilling and fraud, reduce waste, and generate an economic stimulus. Clear prices are a major patient’s rights victory — something to celebrate in a year filled with hurdles and setbacks.