Dive Brief:
- With patient demand growing for the price of medical care, states are beginning to collect the rates insurers pay different providers, in some cases making it publicly available to consumers. In 14 states, insurers are required to disclose that information.
- Hospitals do sometimes disclose prices on their websites, though these are usually list prices, which are much higher than what most patients would usually pay. And it's true that some insurance companies offer cost estimates to enrollees. But accurate price data is hard to come by.
- While disclosing prices doesn't automatically lead patients to choose cheaper care, such disclosures have had impacts in some cases. For example, in New Hampshire, doctors have actually been coming to Anthem BlueCross BlueShield asking to be paid less so they could be among the low-cost providers consumers are incentivized to use.
Dive Insight:
Sharing provider pricing data may be useful for consumers, in theory, but it seems that in practice, consumers are much more motivated by schemes that reward them for using lower-cost providers. These schemes, which sometimes include "reference pricing"—the practice of setting a maximum that the health plan will pay for a procedure or treatment—seem to have powerful effects.
But there are some disadvantages to building such transparency programs. For one thing, simply throwing the data at consumers, especially without integrating quality ratings, seldom seems to influence their behavior. Another concern is that when hospital data is publicly offered, struggling hospitals seeking to compete may cut their prices so low that destroys them financially.
On the whole, while price transparency seems to have the potential to benefit consumers, current price disclosure programs are not enough on their own. Providers and payers will need to teach consumers how to leverage this data to their best advantage.