State transparency approaches may serve as models.
In response to a new Senate price and quality transparency initiative, hospital advocates outlined measures they would support but also urged caution in pursuing new federal requirements. A bipartisan group of six senators wrote a letter in early March to a group of healthcare industry advocacy organizations—including HFMA and several hospital associations—to seek feedback about ways to improve price and quality data transparency. Their responses are particularly interesting in light of a more recent proposal in the FY19 Inpatient Prospective Payment System rule to require that hospitals post their “standard charges” online (hfma.org/OnlineChargePosting).
The healthcare organizations’ responses support transparency, and they outline numerous existing state and federal transparency initiatives in which they already participate.
For example, several respondents cited a May 2014 HFMA report, “Price Transparency in Health Care” (hfma.org/PriceTransparencyInHealthCare) which was produced by a multi-stakeholder task force and created a framework for communicating price transparency to different purchaser groups. The task force also developed a consumer guide (hfma.org/consumerguide) to understanding healthcare prices, and in support of the task force, the American Hospital Association (AHA) developed a price transparency toolkit for hospitals.
AHA warned that a better understanding is needed of what price and quality transparency information would best serve patients.
“More research is needed to understand what type of pricing patients want and would find useful in their healthcare decision-making,” Tom Nickels, executive vice president at AHA, wrote in a letter to the senators.
The need for better understanding of patients’ wishes related to transparency is illustrated by the relatively scant use of existing transparency tools. “Patients have not used much of the data that already is available—whether it is through public-payer initiatives, like the Compare tools available through the Centers for Medicare & Medicaid Services (CMS), or private-sector initiatives, such as Castlight Health,” Nickels wrote.
America’s Essential Hospitals (AEH), which represents safety net hospitals, warned that transparency requirements can increase care delivery costs without improving quality. “If hospitals are required to report specific data, this reporting should not lead to additional administrative burden, and efforts should be undertaken to examine the usefulness of data already being reported,” Bruce Siegel, MD, president and CEO of AEH, wrote to the senators.
But hospital advocates responding to the senators made clear that they viewed the revised Star Ratings as still falling far short of providing reliable data for patients. “While the goal of the Star Ratings is to make Medicare quality data more understandable for patients, their families, and caregivers and to help inform choices among facilities, the methodology is seriously flawed, despite attempts on the part of CMS to improve it, and should be suspended until all calculation errors are corrected,” Chip Kahn, president and CEO of the Federation of American Hospitals (FAH), wrote in a letter to the senators.
Despite the cautionary notes, hospital organizations identified several areas of transparency in which they support new federal action.
HFMA in its letter urged legislation instructing CMS to make price-sharing information for specific services available to Medicare beneficiaries for services provided in settings other than hospital outpatient departments and ambulatory surgical centers.
Federal support—including funding—is needed to identify applicable transparency data points, AEH wrote. There is wide variation now in the healthcare costs of the various subpopulations Medicare and Medicaid serve,” Siegel wrote. “Policymakers should look to state-level practices to establish a baseline understanding of information currently provided, identify gaps, and institute a standardized method to share price and quality information nationally.”
For example, the Colorado Hospital Price Report is a joint project of the Colorado Hospital Association and the Colorado Division of Insurance. The initiative publishes hospital prices and health insurer payments on a public website, including average hospital charges and the average payment rates of insurance companies or health maintenance organizations.
This article is an abbreviated version of an original news story that ran in HFMA Business News, hfma.org/news.
Rich Daly is a senior writer/editor in HFMA’s Washington, D.C., office. Follow Rich on Twitter: @rdalyhealthcare