Making Price Transparency Happen
From the President: Joseph J. Fifer, FHFMA, CPA
“It’s complicated” is a good assessment of the situation … but it’s not enough today.
The calls for price transparency in health care today are growing. The tone of the discussion around this issue is getting more urgent. And the issue is undeniably complicated. So it’s important that we frame this issue in the right way: Expectations of price transparency are not unreasonable. It makes sense that patients want to know the total cost of their care and what their financial responsibilities will be. It’s time for the healthcare industry to acknowledge that these requests are reasonable and figure out how to meet them.
The road to the opaque pricing system that’s now in place has been long and convoluted. It started back in the 1980s, triggered by the Medicare shift to DRG-based payment, which created lasting ripple effects throughout the system. But how we got here is largely irrelevant at this point. All stakeholders share in the responsibility for where things stand today in health care. It’s time to stop finger-pointing and focus on finding solutions.
What matters is what we do going forward. We are in a new age, and we need to live with that reality. We often talk about the complexity of this issue. Yes, “It’s complicated,” but saying that doesn’t get us anywhere. Instead of falling back on this as an excuse, we need to find a way to make our complex system easier for others to understand. Imagine how you would feel if you took your car to the mechanic, only to be told “It’s complicated” each time you had a question about what was happening. I know I’d find that frustrating. I think that’s how far too many of our patients feel today.
All of us in health care—including hospitals, payers, and physicians—need to take ownership of the price transparency issue. I’m pleased to report that some of us already have, and I find those examples encouraging. For example, providers like Maricopa Integrated Health System in Arizona have created sliding fee scales for the uninsured that link household income (as a percentage of federal poverty level) to a three-tier charge scale (calculated as a percentage of Medicare rates). In Wisconsin, the web-based PricePoint system, which is maintained by a subsidiary of the state hospital association, enables patients to view average and median charges for a provider, run comparisons between providers, and view information on a provider’s volume for the selected service. New Hampshire Health Cost, another web-based tool, generates price estimates for both insured and uninsured patients. Initiatives like these offer not only ideas but also inspiration for the rest of us.
At the end of the day, it’s the people who are providing the care—and the finance professionals and other leaders who are supporting their efforts—who are best equipped to chart a path through the complexity. Our shared goal is to enable patients to find the information they need to make the right decisions. Just as all stakeholders had a role in creating this opaque pricing system, all will have a role in fixing it. Stay tuned for more from HFMA on this vital issue.
From the President's Desk
Joe Fifer expands on the ideas in his January column.
Publication Date: Wednesday, January 01, 2014