Massachusetts sets new standard for health care cost transparency

Oct 9, 2014 | Health Insurance Billing

Two years ago, Massachusetts legislators approved a law that required health insurers and hospitals to disclose the costs of their services. As of October 1, this law is now in effect.

While the changes have not yet received much media attention, Barbara Anthony, the Undersecretary for Consumer Affairs and Business Regulation, shared her excitement about the changes with Kaiser Health News. 

"This is a very big deal," she explained. "Let the light shine in on health care prices."

Now, any subscriber of private health insurance in the state can find find the price for everything from a physical to a total knee replacement on their insurer's website. The prices are all in "real-time," meaning insurers and providers are required to display the most up-to-date pricing information. 

This tool is also able to help subscribers of high-deductible plans better anticipate the cost of their care. According to Kaiser Health News, an online calculator shows how much you've spent so far this year toward your deductible. If you are one of the few with a no-deductible plan, the tool can also calculate your out-of-pocket cost maximum. 

However, there are still certain caveats to the information. The prices listed may not always include all of the fees included in treatment, such as facility or specialist fees. The source also notices that information of the cost of inpatient treatment is also often lacking.

Still, the information does help to empower health care consumers better prepare for the cost of care, and find the providers closest to them with a cost structure they can afford. 

When patients are prepared for the cost of care, hospitals and care facilities are less likely to experience the complications that arise from bad debt. Until other states are able to offer such tools, the decision to outsource receivables management can help to avoid issues with cash flow and result in a significant decrease in the number of dollars written off to bad debt.