Making yet another attempt to reign in healthcare costs, policy experts at both the federal and state levels have suggested that pricing transparency will bring consumerism back into the healthcare market.
Over half the states have passed laws on transparency, and there is increasing urgency to address costs based on the popularity of high-deductible plans.
While it’s certainly true that high deductibles can create financial hardship for patients, the data are unclear as to the actual impact of price transparency on patient choice and reducing expenses.
Studies have shown a variable impact on physician behavior, with equally questionable outcomes when patients are made aware of expenses. Some studies indicate that only 10 percent of patients use price transparency tools.
Recent CMS regulations requiring the promulgation of hospital chargemaster costs provide essentially no meaningful information to consumers. Charges do not reflect Medicare, Medicaid or negotiated insurance rates or even blended/average rates.
In radiology, charges are further obfuscated by combining technical and professional components. The coding descriptor of hospital service is completely opaque. The “transparency” sought is a myth and brings no benefit to patients seeking real market-based information.
The time has come to publish direct-to-consumer or self-pay pricing so that real competitive information may be compared. Getting the information to patients, both directly and through ordering physicians, is most effective.
In the present morass of confusing policy initiatives and questionable outcomes, how can radiologists be well positioned for future legislation and market changes?
Here are four suggestions.
1. Remember that value is more than just a buzzword. When calculating value, cost is the denominator and quality is the numerator. Be cognizant of the quality measures within radiology that will make your costs attractive and your value even greater.
2. Work with your technical provider and establish global direct-to-consumer pricing for your most common imaging procedures. By having a clear, unambiguous pricing list to review, patients will know the exact expenses to expect. Other consumer-friendly options include creating sliding-scale pricing based on need or ability to pay and favorable payment terms for those interested. These strategies show your willingness to work with consumers fairly.
3. Invest in dedicated personnel and resources to educate patients. Education promotes patient engagement. A strong movement is afoot to promote shared decision-making and informed consent, both of which enhance the patient experience. While creating objective and discrete pricing lists is highly desirable, the ability to keep patients involved not only in pricing but also their care decisions is valuable.
4. Identify large employers with high-deductible plans and insurance brokers to negotiate preferred high-value contracts. Large, independent MRI vendors have employed this strategy, cutting out local and regional hospitals and radiologists from business.
Self-insured employers have lately been moving to negotiate more aggressively on behalf of their employees, while large insurance brokers have been seeking preferred pricing along with high quality and tailored services.
Transparency can be a valuable tool to establish ongoing success in your radiology market. Combining it with quality and customer service rooted in patient engagement is a sure formula for long-term success.
Dr. Argy is a radiologist and attorney who is a recognized expert in radiology risk management and patient safety. He’s online at NicolasArgy.com.