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Price transparency picks up speed

Raw data on pricing doesn't mean much to the average consumer, who lacks the resources to translate or comprehend it

It’s no secret that the price transparency movement has picked up speed and become increasingly complicated for all stakeholders. Though over 30 states have passed or proposed legislation to increase price transparency, and released median prices for specific services, many supporters of price transparency have pushed for more detailed data. Specifically, all amounts paid to every provider, for every service, so prices and trends can be tracked more definitively.

This past March, Health Care Incentives Improvement Institute (HCI3) and Catalyst for Payment Reform (CPR) released their second annual Report Card on State Price Transparency Laws. Forty-five states failed and only two were awarded a B.

With these types of developments in mind, the George Washington University’s online master of public health, MPH@GW, recently released Illuminating Health Care Prices: Organizations to Watch, which profiles 14 organizations helping to achieve greater healthcare price transparency through policy as well as various initiatives, resources and tools. Since price transparency is a primary or subsidiary goal for myriad organizations and companies, the list isn’t intended to provide a comprehensive view of the price transparency landscape, but rather to explain the multifaceted hurdles and triumphs of the movement by taking a deep dive into the work that several of these organizations are doing.

The project also includes interviews with influencers about their role in the conversation and what makes price transparency so difficult to achieve from a structural, political and practical standpoint. Though Big Data in healthcare has been a source of fascination over the past few years, collecting, storing and forming conclusions about it in a way that produces meaningful action is difficult, says David Newman, executive director of the Health Care Cost Institute (HCCI). FAIR Health executive director Robin Gelburd concurs: “For us, transparency isn’t even the catchword anymore. We see a huge difference between transparency and clarity,” said Gelburd. “We try to not create a chaotic pile of data, but to really contextualize the data and use language that is comprehensible and that gives people a foundational understanding.”

Raw data on pricing – such as recent releases from the Centers for Medicare & Medicaid Services (CMS) – doesn’t mean much to the average consumer, who lacks the resources to translate or comprehend it. Researchers and industry experts are, similarly, unlikely to have the technological bandwidth to accommodate data sets of this size and scope. To contend with this problem, HCCI created a formidable database that contains medical and pharmacy claims for 50 million Americans from all 50 states and D.C. since 2007, as well as the amounts paid by insurers and by patients, out-of-pocket. The point? This database makes it possible for researchers to come to the data instead of the other way around.

For some organizations, teaching providers how to communicate with patients is paramount. Choosing Wisely, a much-lauded initiative of the American Board of Internal Medicine (ABIM), encourages clinical professionals to select treatment plans carefully to help prevent unnecessary procedures, which can rack up excessive bills and possibly put patients in danger. One part of that equation includes facilitating productive and honest conversations between providers and patients about the affordability of a given procedure or service.

Costs of Care’s Teaching Value Project (which is funded by ABIM), similarly, makes learning to be conscious of patient costs a vital concern for aspiring and experienced practitioners. Another example comes from the Healthcare Financial Management Association (HFMA), which gathered health providers, insurers and consumer groups to create Guiding Principles and Recommendations for Price Transparency. The report provides recommendations for how providers can ensure that their patients have access to reliable healthcare cost information.

Consumer education regarding price variation was another important theme. Jeffrey Rice, MD, of Healthcare Bluebook says many patients are unaware of the extent to which prices vary in healthcare: “Patients need to understand that there is enormous price variation in healthcare. If you’re going to buy a gallon of gas, it might be $3.85 at one pump and $3.10 at another. In healthcare, the equivalent is $4.00 to $20.00.” Though the concept of shopping for healthcare services is still taking root, Costs of Care executive director Neel Shah, MD, says the tide is turning. “What started as a cottage industry less than five years ago has become a booming movement to empower patients with information on the cost of care,” said Shah. “In 2014, we make purchasing decisions for every other commodity based on transparent price and quality information. Why not healthcare, too?”

In addition to basic educational resources, many of those profiled have created consumer-friendly tools that can be used immediately by patients to find and compare prices. Healthcare Bluebook, for instance, lists thousands of procedures, tests, medications and services and their fair market cash price by zip code. Clear Health Costs offers consumers pricing information for health-related procedures and treatments in New York, San Francisco, Los Angeles, Dallas-Fort Worth, Houston, San Antonio and Austin. HCI3 founded, which helps patients find high-quality doctors, lists sample questions to ask during appointments, and provides ways to demand price transparency at the local and state levels. To learn more about the work being done by these organizations and others like them, visit