Health Care Price Transparency Research Articles

Usability of Health Care Price Transparency Data in the United States: Mixed Methods Study.

Increasing health care expenditure in the United States has put policy makers under enormous pressure to find ways to curtail costs. Starting January 1, 2021, hospitals operating in the United States were mandated to publish transparent, accessible pricing information online about the items and services in a consumer-friendly format within comprehensive machine-readable files on their websites. The aims of this study are to analyze the available files on hospitals' websites, answering the question-is price transparency (PT) information as provided usable for patients or for machines?-and to provide a solution. We analyzed 39 main hospitals in Florida that have published machine-readable files on their website, including commercial carriers. We created an Excel (Microsoft) file that included those 39 hospitals along with the 4 most popular services-Current Procedural Terminology (CPT) 45380, 29827, and 70553 and Diagnosis-Related Group (DRG) 807-for the 4 most popular commercial carriers (Health Maintenance Organization [HMO] or Preferred Provider Organization [PPO] plans)-Aetna, Florida Blue, Cigna, and UnitedHealthcare. We conducted an A/B test using 67 MTurkers (randomly selected from US residents), investigating the level of awareness about PT legislation and the usability of available files. We also suggested format standardization, such as master field names using schema integration, to make machine-readable files consistent and usable for machines. The poor usability and inconsistent formats of the current PT information yielded no evidence of its usefulness for patients or its quality for machines. This indicates that the information does not meet the requirements for being consumer-friendly or machine readable as mandated by legislation. Based on the responses to the first part of the experiment (PT awareness), it was evident that participants need to be made aware of the PT legislation. However, they believe it is important to know the service price before receiving it. Based on the responses to the second part of the experiment (human usability of PT information), the average number of correct responses was not equal between the 2 groups, that is, the treatment group (mean 1.23, SD 1.30) found more correct answers than the control group (mean 2.76, SD 0.58; t65=6.46; P<.001; d=1.52). Consistent machine-readable files across all health systems facilitate the development of tools for estimating customer out-of-pocket costs, aligning with the PT rule's main objective-providing patients with valuable information and reducing health care expenditures.

The effects of price transparency and debt collection policies on intentions to consume recommended health care: A randomized vignette experiment

AbstractNew laws promote price transparency in health care, though effects on patient decision‐making are not known. Price disclosure may increase the salience of cost and cause lower‐income patients to decline recommended care, worsening inequities in health outcomes. Whether patients perceive a disclosed cost as higher or lower than their expectations may also affect care decisions, but has not been studied. Scholars and policymakers have paid much less attention to the question of whether patients will have to pay the prices charged (whether disclosed or not), and how expectations regarding collections may also affect healthcare consumption. Some hospitals aggressively collect on unpaid medical bills. Others hospitals do not. Actively disclosing collection policies (whether aggressive or protective) could magnify or counteract effects of price disclosures, especially for low‐income patients. To test the effect of price disclosure and debt‐collection disclosures on willingness to obtain recommended care, we recruited a nationally representative sample (N = 2997) and deployed a full factorial, controlled experiment in a standardized clinical vignette model. We find that disclosing a higher‐than‐anticipated price increases the probability of declining recommended care (odds ratio = 1.900), with larger effects for low‐income individuals. Even more, disclosing aggressive collections increases the risk of declining care (odds ratio = 4.493), at higher rates for low‐income patients. Where patients fear collections, but do not know prices, they are most likely to decline care. Disclosure of an aggressive collections policy makes patients feel less informed, harms patient trust in providers, makes them feel that they were not treated fairly, and undermines their confidence in the value of their care. Mediation analysis shows that about half of the effect of collections risk is via these attitudinal variables.

Healthcare price transparency in North America and Europe.

Healthcare price transparency is an effort to inform patient decision-making, but also to decrease prices and their variation across healthcare systems for equivalent medical services. The initiative is meaningful only for medical services that are shoppable-such as imaging examinations-for which patients incur out-of-pocket costs. Therefore, several countries in which patients commonly share a portion of their healthcare costs have been implementing mandates to improve healthcare price transparency. However, the provisional implementation has many issues, especially in the United States, including provider non-compliance and limited accessibility of price transparency tools by the general public. Many of the existing tools are not user-friendly, are difficult to navigate, focus on charges and health plan negotiated rates rather than patients' out-of-pocket costs, and disclose prices on the service level instead of per episode of care. As such, the disclosed amounts are often not reliable. Many price transparency tools also lack valid and measurable quality metrics, which can result in a selection of high-cost care as a proxy for high-value care, as well as an increase in healthcare prices when providers want to imply they offer high-quality care. Nevertheless, the impact of the initiatives on patients' decision-making and healthcare costs remains unclear. While transparency initiatives are patient-centric, efforts should be made to increase patient engagement, provide accurate patient-specific out-of-pocket cost information, compare available treatment and provider alternatives, and couple price information with quality metrics to enable making fully informed decisions.

Issues and Challenges Pertaining to Financing in Providing Pricing Transparency in the American Health Care Industry

In January 2021, hospitals and payer-specific entities in the United States were mandated to comply with the new pricing transparency rules. These rules applied to all standard charges a hospital applied to services provided to and for a consumer. From a financial perspective, the issue of price transparency in health care has for several decades surfaced as a legitimate concern of consumers, health care providers and payers. The aim of this article is to historically examine where and how pricing in health care began and to illustrate financial issues leading up to the current transparency in pricing required by health care payers and providers. A comparative analysis of issues and challenges pertaining to the transparency in pharmaceutical product pricing between the United States and India is also provided in brief.

Complex Billing for Nonemergency Outpatient Imaging: An Obstacle to the Success of Health Care Price Transparency Initiatives.

Recent price transparency initiatives have considerable limitations, notably due to the complexity of health care products. A single care encounter often consists of several services that may be performed by numerous clinicians and health care facilities that bill independently. The objective of this study was to describe the complexity in billing for nonemergency, noninvasive outpatient imaging and its variation across care delivery settings and imaging modalities. Using billing records from the 2019 IBM MarketScan Commercial Database, the authors examined the number of billing entities involved in outpatient imaging encounters and the sets of relevant items and services for which patients were billed. In total, 5,210,129 imaging encounters were analyzed. Patients received bills from multiple billing entities for 70.9% hospital-based encounters, 4.5% office-based encounters, and 7.6% encounters at imaging centers. Contrast agent was billed separately from the imaging procedures in 55.9%, 71.5%, and 55.3% of encounters for contrast imaging at hospitals, offices, and imaging centers, respectively. Billing for other ancillary items and services (facility fees, 3-D reconstruction, anesthesia and sedation) was relatively rare. Two key aspects of billing complexity may make obtaining complete and reliable price estimates before receiving outpatient imaging difficult for patients: the number of billing entities involved in care delivery and billing for fees and ancillary services beyond the primary imaging procedure. Given that price transparency initiatives are aimed primarily at helping patients anticipate the total cost of their care, policymakers, payers, and providers should take additional steps to provide patients with reliable information on the prices of entire care experiences.

JACR Health Policy Expert Panel: Hospital Price Transparency.

The desire to increase health care price transparency is not new: multiple efforts have been made to do so over several decades. Most recently, in a policy that began on January 2021, CMS now requires all hospitals to publish negotiated prices for “shoppable services” including the technical component fees for 13 CMS-specified diagnostic radiology services [ 1 Forman H.P. Price transparency comes to radiology: are we ready for the attention?. Radiology. 2022; 302: 625-626https://doi.org/10.1148/radiol.2021212464 Crossref PubMed Scopus (1) Google Scholar ].

Concordance of Disclosed Hospital Prices With Total Reimbursements for Hospital-Based Care Among Commercially Insured Patients in the US

To improve health care price transparency and promote cost-conscious selection of health care organizations and practitioners, the Centers for Medicare & Medicaid Services (CMS) required that hospitals share payer-specific negotiated prices for selected shoppable health services by January 2021. While this regulation improves price transparency, it is unclear whether disclosed prices reflect total costs of care, since many hospital-based services are delivered and billed separately by independent practitioners or other health care entities. To assess the extent to which prices disclosed under the new hospital price transparency regulation are correlated with total costs of care among commercially insured individuals. This cross-sectional study used a large database of commercial claims from 2018 to analyze encounters at US hospitals for shoppable health care services for which price disclosure is required by CMS. Data were analyzed from November 2020 to February 2021. Whether the service was billed by the hospital or another entity. Outcomes of interest were the percentage of encounters with at least 1 service billed by an entity other than the hospital providing care, number of billing entities, amounts billed by nonhospital entities, and the correlation between hospital and nonhospital reimbursements. The study analyzed 4 545 809 encounters for shoppable care. Independent health care entities were involved in 7.6% (95% CI, 6.7% to 8.4%) to 42.4% (95% CI, 39.1% to 45.6%) of evaluation and management encounters, 15.9% (95% CI, 15.8% to 16%) to 22.2% (95% CI, 22% to 22.4%) of laboratory and pathology services, 64.9% (95% CI, 64.2% to 65.7%) to 87.2% (95% CI, 87.1% to 87.3%) of radiology services, and more than 80% of most medicine and surgery services. The median (IQR) reimbursement of independent practitioners ranged from $61 ($52-$102) to $412 ($331-$466) for evaluation and management, $5 ($4-$6) to $7 ($4-$12) for laboratory and pathology, $26 ($20-$32) to $210 ($170-$268) for radiology, and $47 ($21-$103) to $9545 ($7750-$18 277) for medicine and surgery. The reimbursement for services billed by the hospital was not strongly correlated with the reimbursement of independent clinicians, ranging from r = -0.11 (95% CI, -0.69 to 0.56) to r = 0.53 (95% CI, 0.13 to 0.78). This cross-sectional study found that independent practitioners were frequently involved in the delivery of shoppable hospital-based care, and their reimbursement may have represented a substantial portion of total costs of care. These findings suggest that disclosed hospital reimbursement was usually not correlated with total cost of care, limiting the potential benefits of the hospital price transparency rule for improving consumer decision-making.

Health Care Price Transparency in Ophthalmology

Health care price transparency legislation is intended to reduce the ambiguity of hospital charges and the resultant financial stress faced by patients. To evaluate the availability, usability, and variability of standard reported prices for ophthalmologic procedures at academic hospitals. In this multicenter economic evaluation study, publicly available price transparency web pages from Association of American Medical Colleges affiliate hospitals were parsed for standard charges and usability metrics. Price transparency data were collected from hospital web pages that met the inclusion criteria. Geographic practice cost indices for work, practice expense, and malpractice were sourced from the Centers for Medicare & Medicaid Services. Data were sourced from February 1 to April 30, 2021. Multiple regression was used to study the geographic influence on standard charges and assess the correlation between standard charges. Availability and variability of standard prices for Current Procedural Terminology (CPT) codes 66984 (removal of cataract with insertion of lens) and 66821 (removal of recurring cataract in lens capsule using laser). Of 247 hospitals included, 191 (77.3%) provided consumer-friendly shoppable services, most commonly in the form of a price estimator or online tool. For CPT code 66984, 102 hospital (53.4%) provided discount cash pay estimates with a mean (SD) price of $7818.86 ($5407.91). For CPT code 66821, 71 hospital (37.2%) provided discount cash pay estimates with a mean (SD) price of $2041.72 ($2106.44). The top quartile of hospitals, prices wise, listed included prices higher than $10 400 for CPT code 66984 and $2324 for CPT code 66821. Usability issues were noted for 36 hospitals (18.8%), including requirements for personal information or web page navigability barriers. Multiple regression analysis found minimal explanatory value for geographic practice cost indices for cash discount prices for CPT codes 66984 (adjusted R2 = 0.54; 95% CI, 0.41-0.67; P < .001) and 66821 (adjusted R2 = 0.64; 95% CI, 0.51-0.77; P < .001). Despite recent legislature that codified price transparency requirements, some current standard charges remain ambiguous, with substantial interhospital variability not explained by geographic variability in costs. Given the potential for ambiguous pricing to burden vulnerable, uninsured patients, additional legislation might consider allowing hospitals to defer price estimates or rigorously define standards for actionable cash discount percentages with provisions for displaying relevant benchmark prices.

Analysis of Hospital Quality Measures and Web-Based Chargemasters, 2019: Cross-sectional Study.

BackgroundThe federal health care price transparency regulation from 2019 is aimed at bending the health care cost curve by increasing the availability of hospital pricing information for the public.ObjectiveThis study aims to examine the associations between publicly reported diagnosis-related group chargemaster prices on the internet and quality measures, process indicators, and patient-reported experience measures.MethodsIn this cross-sectional study, we collected and analyzed a random 5.02% (212/4221) stratified sample of US hospital prices in 2019 using descriptive statistics and multivariate analysis.ResultsWe found extreme price variation in shoppable services and significantly greater price variation for medical versus surgical services (P=.006). In addition, we found that quality indicators were positively associated with standard charges, such as mortality (β=.929; P<.001) and readmissions (β=.514; P<.001). Other quality indicators, such as the effectiveness of care (β=−.919; P<.001), efficient use of medical imaging (β=−.458; P=.001), and patient recommendation scores (β=−.414; P<.001), were negatively associated with standard charges.ConclusionsWe found that hospital chargemasters display wide variations in prices for medical services and procedures and match variations in quality measures. Further work is required to investigate 100% of US hospital prices posted publicly on the internet and their relationship with quality measures.

Clinical Faceoff: How Will Recent Price Transparency Policies Impact Orthopaedic Surgery and its Patients?

Clinical Faceoff: How Will Recent Price Transparency Policies Impact Orthopaedic Surgery and its Patients?

Survey of Hospital Chargemaster Transparency.

In January 2019, the Centers for Medicare & Medicaid Services (CMS) required hospitals to list their standard charges (chargemasters) publicly in an effort to increase price transparency in health care. Surveying hospital chargemasters may be informative to assess the implementation of this rule and its utility to consumers. We aimed to compare hospital chargemaster data within a local hospital market where patients would reasonably try to shop or compare services. We identified and aggregated Dallas County hospital chargemasters available in a database compatible format in May 2019. We manually examined a convenience sampling of 10 common laboratory tests, medications, and procedures. Thirteen hospital chargemasters were identified. Eleven hospitals had chargemasters available in a database compatible format (xlsx or csv). These 11 chargemasters were aggregated into a single file containing 155,576 chargeable items, prices, and descriptions. We observed heterogeneous names and descriptions of synonymous items across institutions, preventing automated comparisons. The examined items revealed a high variation in charges. The largest charge variation for laboratory tests examined included a 2,606% difference (partial thromboplastin time: $18.70-506.00), for medications an 18,617% difference (5-mg tablet of amlodipine: $0.23-43.05), and for procedures a 2,889% difference (circumcision: $252.00-7,532.10). One institution accounted for 27% of the lowest prices and another accounted for 60% of the highest prices. Chargemaster data presentation varied among the hospitals surveyed, making automatic comparison impossible. Chargemaster data are difficult to interpret for health care decisions. Refining the minimum requirements for publishing chargemaster data could increase their utility.

Online Advertising Increased New Hampshire Residents' Use Of Provider Price Tool But Not Use Of Lower-Price Providers.

Insurers and policy makers have created health care price transparency websites to facilitate price shopping and reduce spending. However, price transparency tools to date have been plagued by low use. It is unclear whether this low use reflects a lack of interest or a lack of awareness. We launched a large online advertising campaign to increase consumers' awareness about insurer-specific negotiated price information available on New Hampshire's public price transparency website. Our campaign led to a more than 600percent increase in visits to the website. However, in our analysis of health plan claims, this increased use of the website did not translate to increased use of lower-price providers. Our findings imply that the limited success to date of price transparency tools in reducing health care spending is driven by structural factors that limit consumers' ability to use health care price information as opposed to only a lack of awareness about price transparency tools.

Price Transparency in Healthcare: Understanding the Impacts of the Price Disclosure Policy in Maine

Price Transparency in Healthcare: Understanding the Impacts of the Price Disclosure Policy in Maine

Should a Good Risk Manager Worry About Cost and Price Transparency in Health Care?

Roles of hospital risk managers have grown over the last 30 years. Once largely focused on hospital liability risk management, risk managers today have a broader set of enterprise risk management responsibilities. The following commentary about a surprise billing case considers roles of risk managers in promoting cost and price transparency.

17111 Price transparency and variability of dermatologic treatments in Massachusetts hospitals: A state-wide analysis

Background: Government efforts to increase health care price transparency have led to legislation requiring hospital chargemasters to be publicly available online. Chargemasters include billable hospital charges for inpatient services and items. Since the implementation of this policy, charges related to the treatment of dermatologic conditions in the inpatient setting have not been examined. A statewide analysis was conducted to characterize and compare the variability in charges for specific dermatology-related Diagnosis-Related Groups (DRGs) across Massachusetts hospitals.

Is there variation in private payor payments to cancer surgeons? A cross-sectional study in the USA

ObjectivesAlthough demand for price transparency in healthcare is growing, variation in private payors’ payments to surgeons for oncologic resection has not been well characterised. Our aim was to assess variation...

Chargemasters and price transparency in dermatology

To the Editor: A chargemaster is a comprehensive listing of items billable to a patient or their insurance provider. Chargemasters contain anywhere from 20,000 to 50,000 prices, which include medical procedures, equipment fees, drugs, supplies, and diagnostic tests.1Kongstvedt P.R. Essentials of Managed Health Care. Jones & Bartlett Learning, 2012: 114-115Google Scholar Every hospital maintains its own chargemaster. On June 24, 2019, in an attempt to increase health care price transparency, the Trump administration mandated that all hospitals make their chargemaster public.2Trump D. Executive Order on Improving Price and Quality Transparency in American Healthcare to Put Patients First. The White House, The United States Government.www.whitehouse.gov/presidential-actions/executive-order-improving-price-quality-transparency-american-healthcare-put-patients-first/Date: 2019Date accessed: June 30, 2019Google Scholar Currently, there are no mandated criteria or guidelines for these published chargemasters. The prices listed within each chargemaster are not reflective of the negotiated prices with third-party payers. However, these prices are, in most instances, the basis for which self-pay patients are charged. Self-pay patients are more likely to price shop, and these lists will not only influence their decision where to receive care but may also deter patients from seeking care altogether. We sought to determine the utility of this executive order by searching for and characterizing several features of chargemasters from the 101 largest United States hospitals, determined by bed size (Table I).Table IHospital and chargemaster characteristicsHospitals characteristicsNumber (%)Region 1. Northeast27 (26.7) 2. Midwest22 (21.8) 3. South46 (45.5) 4. West6 (5.9)Division 1. New England7 (6.9) 2. Mid-Atlantic20 (19.8) 3. East North Central15 (14.9) 4. West North Central7 (6.9) 5. South Atlantic26 (25.7) 6. East South Central6 (5.9) 7. West South Central14 (13.9) 8. Mountain1 (1.0) 9. Pacific5 (5.0)Found in 10 minutes No4 (4.0) Yes97 (96.0)List readable, n (%) NA4 (4.0) No5 (5.0) Yes92 (91.0)Searchable, n (%) NA9 (8.9) No9 (8.9) Yes83 (82.2)CPT codes on list NA9 (8.9) No84 (83.2) Yes8 (7.9)Office visit level separated NA22 (21.8) No19 (18.8) Yes60 (59.4)BX abbreviation used NA25 (24.8) No46 (45.5) Yes30 (29.7)TANGENTL abbreviation NA25 (24.8) No69 (68.3) Yes7 (6.9)Used complexity level time in place of level 2 or 3 NA19 (18.8) No64 (63.4) Yes18 (17.8)BX, Biopsy; CPT, Current Procedural Terminology (American Medical Association, Chicago, IL); NA, not available; TANGENTL, tangential biopsy. Open table in a new tab BX, Biopsy; CPT, Current Procedural Terminology (American Medical Association, Chicago, IL); NA, not available; TANGENTL, tangential biopsy. We found price information for 97 hospitals (96.0%) that was “accessible” (eg, found via internet search by 1 of the authors in ≤10 minutes). There were 92 hospitals (91.1%) with readable lists and 83 hospitals (82.2%) with searchable lists. Only 8 hospitals (7.9%) included Current Procedural Terminology (CPT; American Medical Association, Chicago, IL) codes. There were 30 hospitals (29.7%) with lists that used a “BX” abbreviation for biopsy. Seventy-six hospitals listed a skin biopsy price (median, $487; range, $113-$4382). The relationship between the price charged for a skin biopsy had a strong positive correlation with the price charged for an additional skin biopsy (Spearman ρ = 0.733). The relationship between the price charged for a new level 2 patient had a strong positive correlation with the price charged for an established level 3 patient (Spearman ρ = 0.912). Relationships were weak between other prices. We found that approximately 18% of chargemasters were not searchable (ie, listed in a way that does not allow a search function to find specific terminology). This creates a nearly impossible task for a patient to sort through up to 50,000 items. If a patient had contacted their physician regarding an upcoming procedure, CPT codes are unique billing identifiers that could be provided for a patient to find on the chargemaster. However, only 8% of chargemasters listed CPT codes. Nearly 30% of hospitals listed “BX” for biopsy. Abbreviations like this may be cryptic for patients. With respect to cost, we found the median office visit price for a new level 2 or established level 3 patient was $270 and $275, respectively, and a single biopsy had a median price of $487 (Table II). Although we do realize most patients do not pay these prices, we fear a cost-conscious patient researching medical costs might delay or avoid necessary care altogether due to these inflated prices. Most prices included in our study had a weak correlation, providing evidence these costs may be determined arbitrarily. This executive order may be the start of increased price transparency for our patients, but there remains much work to do.Table IIPrice summaryVariablePrice, $Skin biopsy, n76 Mean (SD)622.65 (581.82) Median (IQR)487.0 (302.0-671.50) Minimum, maximum113.00, 4382.02Additional skin biopsy, n69 Mean (SD)358.77 (379.74) Median (IQR)247.00 (141.00-407.00) Minimum, maximum10.00, 1949.77New level 2 patient, n79 Mean (SD)295.43 (166.48) Median (IQR)270.00 (175.00-379.00) Minimum, maximum55.00, 1000.00Established level 3 patient, n81 Mean (SD)312.88 (189.82) Median (IQR)275.00 (164.00-374.00) Minimum, maximum55.00, 1000.00IQR, Interquartile range. Open table in a new tab IQR, Interquartile range.

Price Transparency in Healthcare: Apply with Caution

There’s a widespread perception that transparent pricing would push healthcare prices downward. While this may be true in certain markets, in many others, it would have little price impact or could even push prices upward via tacit collusion. Under perfect competition, prices are universally known and vary little across buyers and sellers. Such conditions are absent in many or most American healthcare markets. The industrial organization and antitrust literatures suggest that when the number of sellers in a market is small and barriers to entry for new sellers are high—as is true of most healthcare services—public knowledge of prices can lead to tacit collusion. In such cases, sellers act on price information as though they are conspiring to restrict supply and raise prices, without any actual conspiracy, while consumers cannot or do not use prices to change their behavior. Aside from tacit collusion, providers have better information on health and care than patients do. Emergency patients can’t price-shop. Third-party payers, not patients, reap most of the benefits of price-shopping. Even when patients are provided with price-shopping tools, they fail to compare prices. These cautions do not imply a blanket condemnation of price transparency, but they do suggest that policymakers should be highly selective in issuing transparency mandates.

Price Transparency in Radiology—A Model for the Future

Medicine is the only business transaction in which consumers make important purchase decisions without knowing how much they have to pay. Lack of price transparency in health care imposes financial burden and anxiety among patients as the cost of health care has been shifting from employers to patients through high-deductible health plans (HDHPs). Health economists and policymakers anticipated that HDHPs with price transparency would be a catalyst for patients to “shop” for low-price providers, thus reducing overall health care spending. For patients to shop health care services, price transparency is a requisite. The Department of Health and Human Services mandate of publicly disclosing the hospital chargemaster and state legislatures demanding greater health care price transparency are just two examples of external forces challenging the long history of price opacity in health care. Imaging, pharmacy, laboratory tests, and ambulatory surgeries are considered potentially shoppable health care services. This article examines the intended motivation of price transparency, the limitations of current price transparency tools, and what impact price transparency may have on radiology. We share our experience in developing and implementing University of Utah’s online interactive price transparency tool to estimate patients’ out-of-pocket expenses.

What Is the Value of Market-Wide Health Care Price Transparency?

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