By the end of 2018, consumers will have access to 2,800 walk-in clinics across the country—an increase from 200 clinics just 10 years ago. The rise in telemedicine and consumer-centered medicine results in a push toward pricing transparency. Traditional patient care is giving way to today’s retail state of mind.
With patients shouldering a larger portion of the financial burden through high-deductible insurance plans, providers have stepped up their transparency efforts through web-based pricing tools and increased efforts to provide patients with reasonable cost expectations. In theory, it should be simple. However, it isn’t.
It’s complicated. When it comes to charges for specific services, there are no apples-to-apples comparisons. “Clinicians often don’t have the full information needed to make meaningful price estimates,” says Safiyyah Mahomed, a medical student at the University of Toronto and author of a follow-up study focused on U.S. hospitals and their ability to provide an accurate and complete price for services. Hospitals don’t know the physician’s fee for a procedure performed at their facility because they generally don’t do their billing. And clinicians do not have access to essential insurance information for a patient, like deductible requirements and current out-of-pocket spending.
It’s contrary. In a battle of the wills, the two traditional models of payment are at odds. The tug-of-war between the fee-for-service and value-based payment models continues as providers push back against the Centers for Medicare and Medicaid Services (CMS) and the insurance industry to retain an independent stronghold. But, in an age where quality rules and consumers are weary of the medical cost crunch, the CMS is targeting specific ways providers can transition to a value-driven payment model, which comes with its own set of intricacies like capitation agreements, hybrid payments and shared savings.
It’s convoluted. Estimating the actual cost of care is not an exact science since most patients have insurance and rarely pay the full cost. In addition, many providers are not able to provide patients with price estimates at the point-of-service. According to a 2016 Navicure survey, many providers lack patient-facing cost estimation tools, are not adequately staffed to address pricing issues, or are unable to provide convenient online or automatic payment options.
It’s confusing. According to a new report from Harvard Medical School researchers, patients aren’t using pricing tools designed to help them make informed decisions about their medical care. Either the tools are riddled with confusing medical terminology or “consumers lack experience at interpreting the information.” Even lead author Ateev Mehrotra, M.D., M.P.H., associate professor of healthcare policy and medicine at Harvard Medical School, found the tools confusing when he tried to research costs for his own family.
It’s confined. Simply put, healthcare entities don’t talk to each other. Aaron Crane, CEO of Propel Health in Portland, Ore. and a 2016–19 board member of the Healthcare Financial Management Association, says data silos across multiple sources are part of the problem. Consumers don’t fully understand what they owe “because different parts of the pie have different pieces of information,” which aren’t shared. It’s not intentional, Crane says. They simply don’t know. “Once it’s only doctors in the room, or only hospital administrators, or insurance companies, or only industry representatives, that’s when you start dreaming up solutions that are never going to be effective on the ground or on a societal level,“ adds Wynn Hunter, M.D., resident physician in the department of medicine at Duke University Health System.
No matter how complicated, contrary, convoluted, confusing or confined, these barriers to pricing transparency can be removed in time if leaders, stakeholders, insurers and consumers work together. Success hinges on communication. According to Hunter, “Making headway on this problem will require teamwork from a lot of people … who actually listen to each other and have patients’ best interests at heart.”