By Christine Cooper

As healthcare costs continue to rise with inflation, a patient’s need for easy and immediate access to accurate pricing of hospital and provider services is critical, placing price transparency in the spotlight.

According to Forbes, price transparency is a necessary first step toward a better healthcare system. In fact, it has become a national priority. Federal legislation and associated regulations now mandate transparent price information with a goal of adding insight, protection and fairness. This is helping patients nationwide gain digital, real-time access to accurate provider and hospital fees, the ability to anticipate the total cost of their care and determine out-of-pocket costs prior to receiving care.

Attention to price transparency comes at a critical time when many Americans are described as “financially fragile.” Most people have not set aside adequate savings specifically earmarked for out-of-pocket medical expenses, including regular cost sharing, deductibles, copayments or coinsurance. A near-confirmed national recession, has Americans anxious over “what’s next” in terms of cost increases and what will add to their financial stress.

Price transparency puts patients in the driver’s seat by enabling them, as healthcare consumers, to shop and compare provider services and save money. This insight has potential to transform an employee’s health coverage usage, putting the economic purchasing power and decision-making in their hands. When combined with broader reforms, patients are empowered to play an active role in managing their health care utilization and controlling their healthcare spend.

Federal regulation
To increase price transparency practices in healthcare, the Centers for Medicare and Medicaid Services (CMS) mandates that hospitals and providers publish meaningful price information for patients. As of January 1, 2021, the Centers for Medicare and Medicaid Services (CMS) issued mandates that hospitals operating in the US provide clear, accessible pricing information online about the items and services they provide. Under CMS guidance and final rules, hospitals are required to make pricing information available in machine-readable format, as well as provide a list of shoppable services that a patient can schedule in advance. This is intended to make information accurate and easier to access for health service consumers to compare prices, estimate the cost of care and assess market value.

As another layer of price transparency, In November of 2022, the Department of Health and Human Services (HHS) published the Hospital Owners Information dataset (the Dataset). The Dataset is aimed at making transparent the ownership structure of Medicare-certified hospitals.

No Surprises Act
The lack of transparency that pervades the healthcare system exposes patients to problems such as surprise medical bills. The No Surprises Act (NSA) took effect in January 2022, establishing new federal protections against most surprise out-of-network medical bills. Surprise billing occurs when a patient receives out-of-network services during an emergency visit or from an out-of-network provider at an in-network hospital or other facility without advance notice and consent. The Act prohibits providers from billing patients more than the median in-network charge and allows providers to appeal disputes over coverage of surprise bills to a third party.

Advanced EOB
For participants in an employer-sponsored health plan, healthcare consumerism brings an opportunity to improve engagement and understand their health plan. Today, plans regularly provide an explanation of benefits (EOB) which confirms any excluded charges, the covered charges, and how the covered charges will be shared between the participant and the plan.

The NSA provides for an “Advanced EOB.” In the future, participants will be able to gain a better estimate of the portion of any anticipated medical services that qualify for plan benefits, and what portion of those expenses will be paid by the participant. Participants will be able to request a Good Faith Estimate (GFE) from their medical providers. Then, the GFE can be submitted to the health plan administrator as part of a request for an Advanced EOB.

Transparency in coverage
Going forward, innovators are likely to leverage the Advanced EOB process to compare the cost sharing for the submitted GFE in a side-by-side display and to bring attention to a quality provider charging lower costs. Beginning January 1, 2023, a new transparency rule took effect: Transparency in Coverage (TiC) requires insurers and plans to disclose negotiated rates for in and out-of-network rate history and drug pricing information. The goals are the same in terms of prompting consumerism – ensuring participants have access to the information necessary to incorporate financial criteria into their decisions regarding medical services.

The required provision of an online pricing tool should include personalized, real-time, cost estimates for covered services and items, including pharmacy. Paper versions must be available upon request. Initially, for plan years beginning on or after Jan 1, 2023, the online tool must provide cost estimates for 500 shoppable services. In the future, for plan years beginning on or after Jan. 1, 2024, the online tool must provide cost-share estimates for all covered services.

Selecting a medical billing partner, harnessing technology and powerful data
Health plan sponsors need to take strategic action to ensure that their employer-sponsored, self-insured plans incorporate the most effective strategies for addressing today’s economic challenges to the “health and wealth” of their participants. Despite Federal price transparency mandates, a quality health plan should still provide easy, direct access and understanding of pricing, benefits and out-of-pocket expense information so plan participants can make informed and cost-effective decisions.

Innovative medical billing support services utilize powerful data-driven software and online data analytic tools that can provide a degree of price transparency and new insights by harnessing price data electronically – allowing fee comparisons that identity fair and reasonable prices. A tech-driven approach can provide patients with information and tools to better manage their health care costs. Harnessing technology to understand the vast amount of data can identify potential areas of escalating health costs and identify opportunities to control medical spending.

Cost-management strategies include effectively designed acquisition cost-based pharmacy pricing, HSA-capable coverage, reference-based pricing, adequate participant protections against balance billing, participant advocacy and litigation support.

The right medical billing partner can act as an agent of change, embracing technology innovation and advocating for “what is fair and just.” The right partner will provide value-added services through turnkey solutions, innovative plan designs, administrative and compliance support, as well as participant legal representation. This support provides invaluable guidance to navigate federal and state healthcare regulations, identify areas to lower risk, reduce costs, and maximize value.


About the author: Christine Cooper is the CEO of aequum LLC and the co-managing member of Koehler Fitzgerald LLC, a law firm with a national practice. Christine leads the firm’s health care practice and is dedicated to assisting and defending plans and patients.