About 94 percent of hospitals are not in full compliance with the Centers for Medicare and Medicaid Services’ (CMS) Hospital Price Transparency Rule. The rule is part of a CMS strategy to drive competition and innovation in US healthcare, with the goal of improving patient outcomes.
We here at HDA also believe in the power of data to drive change – especially well-organized, easy-to-search data, which can help both patients and healthcare entities make more informed decisions. That’s why we have applied our data orchestration expertise to US healthcare data.
We collect raw data, clean and standardize it, and make it available for analysis via our Google Looker-powered analytics overlay.
We also help institutions organize and display their own data to comply with the rule. The end goal is true pricing transparency and market efficiency, which will help keep US healthcare at the forefront of innovation.
What’s more, we believe that government agencies, hospitals, and hospital groups can all benefit from greater acceptance of and compliance with the CMS Hospital Price Transparency rule. Here’s how.
1. Increase Ease of Transaction and Customer Loyalty
One goal of the transparency rule is to make it easier for patients to see and compare a provider’s prices so they have a better idea of how much a service will cost before they get the bill.
It’s no secret that medical bills often feel like a surprise to patients. Greater hospital acceptance of the transparency rule means patients will be better able to research and choose a service provider based on a known price.
This can ease the effort of the transaction, a factor that is 40 percent better at predicting loyalty than customer satisfaction, according to Gartner research.
Think about it this way: A surprise bill may prompt a patient to call their provider’s office and possibly their insurance provider. They may work to understand the bill, reduce the bill, or negotiate a payment plan, all of which increase the difficulty of completing the transaction.
If the bill’s higher than expected, it may also increase the consumer’s stress level, which makes transactions even more challenging.
Compliance with the transparency rule means consumers can find the price list on their own, pushing the transaction toward the low-effort category – and therefore the type the consumer is likely to want to repeat.
2. Stay Competitive with Elective Services
Broader acceptance of the price transparency rule won’t just improve the patient experience. It will also make pricing services competitively easier for hospitals.
When you work with us, you gain access to other hospitals’ data as well as your own – all in an easy-to-navigate format. This lets you see which of your services are…
- Already competitively priced, which you can then communicate to patients.
- Too competitively priced for the local market, which may prompt a price increase.
- Too high for the local market, which may prompt a price decrease.
This ability to view pricing data is especially helpful when it comes to pricing elective services, procedures that patients often opt out of for cost reasons.
The COVID-19 pandemic has shown in stark numbers just how important elective procedures are to a hospital’s bottom line. One pre-pandemic analysis found that, in the six months leading up to mid-April 2019, nearly 32 million Americans paid for elective procedures. This amounted to $171 billion, or about 10 percent of annual healthcare spending.
But there is much more opportunity for hospitals to tap into. The analysis also found that, in the same surveyed period, 35.4 million Americans chose to forgo elective procedures, and 73 percent of them cited cost as the reason. The analysis figured this to amount to $86.5 billion in potential lost revenue for the healthcare industry.
With broad acceptance of the price transparency rule in place, hospitals can reconsider their pricing for elective procedures armed with knowledge of how their competitors price such services. More competitive prices – and even prices that are easier to understand – may encourage patients to take the plunge instead of opting out.
3. Increase Negotiating Power with Payers
The transparency rule requires hospitals to publish pricing data that includes negotiated prices for every payer and plan a hospital has negotiated prices with.
When you work with HDA, you gain access to this data, allowing you to see how your negotiated prices compare with your competitors’ negotiated prices with those same players.
When you have hard facts to point to, negotiating with payers is easier.
A recent survey found that Americans (including 40 percent of those aged 45 to 49 and 27 percent of those aged 60 and above) routinely skip wellness visits and other preventive care because of costs.
There is clearly opportunity on the table.
Yet as a CDC study shows, most providers do not prioritize preventive services, despite their well-documented ability to improve health outcomes and providers’ keen awareness of their benefits.
The study found a key reason is that payers offer no financial incentives for preventive services. Most providers “are paid to treat rather than to prevent disease.” One interviewee in the study put it this way: “With no margin, there is no mission.”
Among other benefits, preventive care reduces chronic disease, which is currently a large burden on the healthcare system. Heart disease and stroke alone cost the healthcare system $214 billion annually, to say nothing of the toll on the rest of the economy.
With the power of data and the insights it offers, providers and government agencies can negotiate with payers in a way that aligns the margin with the mission, improving health outcomes for patients and relieving the healthcare industry of the financial burdens of chronic disease.
Harness the Power of Your Data with HDA
Are you ready to leverage the power of US healthcare pricing data?
If you’re not sure whether your hospital is compliant with the transparency rule, our consultants can help you find a compliance score. They can also help you view your organization’s data and the data of competitors with our pricing data and our analytics tool. We look forward to hearing from you!