Health care industry responds to call for greater price transparency

Healthcare industry stakeholders have responded to a demand for greater price transparency.

The rise of insurance plans with high out-of-pocket costs, coupled with Medicare's release of raw data on doctor reimbursements, has led to a demand for greater transparency in the price of health care. Lobbying groups and industry stakeholders have responded by releasing a report with new recommendations on how they can better inform patients on the cost of their treatment.

"We need to own this as an industry. We need to step up," admitted Joseph Fifer, president and CEO of the Healthcare Financial Management Association. The major advancements in the report include a total estimated price of service, patient safety scores and the status of network providers and where to find them. Fifer admits that the stakeholders had a difficult time reaching a decision on who in the health care system would be responsible for providing the pricing information, and what kind of information was necessary to provide. 

A Washington Post article exemplified the problem of price transparency with the results of a 2013 study. Researchers found that just three out of 20 hospitals could say how much an uninsured person should expect to pay for a simple test measuring heartbeat rate.

One of the largest roadblocks for price transparency has been care providers' unwillingness to disclose the rates they have negotiated with health plans, claiming the release of this data could actually cause an increase in prices. The report skirts this issue by suggesting "reference pricing," where employers set the price they are willing to pay for a certain procedure.

Hospitals are hopeful that greater price transparency will help diminish "bad debt" that is a result of patients unable to pay for the cost of their care, creating a hospital billing backlog. Outsourcing medical claims management can help reduce bad debt, improving the practice's bottom line.