RAPID RESPONSE: What price transparency lawsuits mean for hospitals and health systems

Last week, several hospital groups filed lawsuits against HHS around the agency’s rule stating that payers and providers must reveal their negotiated rates. That rule was designed as part of the current administration’s push for price transparency. There’s been lots of excellent discussion about the lawsuits, and whether HHS even has the authority to create a rule forcing transparency around private negotiations.

But the real issue isn’t CMS/HHS. It’s consumers. The bottom line? Patients don’t want to know hospital prices. They want to know how much it will cost them. If people know what medical care is going to cost them ahead of time, they’re more likely to pay.

Even if the government’s efforts to impose price transparency are unsuccessful, the core issue won’t go away. Consumers are not going to let it. So, however the legal situation plays out, hospitals and health systems shouldn’t just sit by and wait until the dust settles. Here’s what they can do today:

  • Share information in a friendly format that real people can understand. (In other words, not the chargemaster.)
  • Focus on those services that are truly shoppable like joint replacements.
  • Consider “all-inclusive” bundles for some services.
  • Invest in a pricing tool.
  • Polish your payment assistance programs.
  • Give patients one-on-one, personalized help through navigators or financial counselors.
  • Educate providers on how to talk about cost.
  • Combine pricing information with quality data because we’ve been programmed as Americans to equate more expensive with better quality.
Kim Fox
kfox@jarrardinc.com