ViVE 2023: Healthcare exes skeptical price transparency mandates will lead to more affordable care

NASHVILLE, Tennessee—For all of the scrutiny over hospitals’ inconsistent compliance with federal price transparency guidelines, there’s still plenty of doubt over whether the requirements will actually lead to more affordable care.

During a panel discussion at ViVE 2023, Prabhjot Singh, M.D., senior adviser at the Peterson Center on Healthcare, said the sweeping effort is still in “kind of a discovery mode” as the industry learns whether the information is usable by app builders or the general public.

The latter group has yet to show widespread adoption, the data analytics leaders and health policy experts on the ViVE panel said.

Only half of healthcare services are currently shoppable, Singh said, and 2021 data from the Peterson-KFF Health System Tracker suggest just 9% of consumers were even aware of the price transparency requirements.

“It kind of begs the question, 'who is it for?'” Singh said. “One of the initial hypotheses was maybe it’s for consumers, maybe they shop, maybe they compare. But I think what we’ve seen for a long time is that patients often are not shopping, even when they do have information.”

Tina Barsallo, vice president of revenue cycle operations at Lifepoint Health, said the organization has so far seen “very low” patient utilization of the machine-readable files and patient-friendly estimator tools published on its hospitals’ websites.

“They’ll prefer to call into the facility and get estimate information, even though we make the information publicly available to them,” she said. “And since the web tool only contains 300 shoppable services, not all services are available there. So in reality they prefer, in many cases, to contact financial counselors at the hospitals to talk through their benefits and get an understanding of why they owe the out-of-pocket [costs] that they owe.”

Niall Brennan, chief analytics and privacy officer at healthcare analytics firm Clarify Health, said expecting most patients to be able to shop for care is inherently unreasonable.

“My real hope here is that employers, who pay for the vast majority of healthcare in the U.S., start to use this data and ask the hard questions about why the rate for C-sections differs not only by $25,000 or $30,000 in the same city but sometimes at the same hospital,” Brennan, whose company sells rates data comparisons and insights to payer and provider customers, said.

Singh agreed and pointed out that some employer groups are already using the data to make a dent during their negotiations.

“You see examples of places like where I live in the state of Indiana, where you have the employers that have come together and worked with the state and hospitals to build a transparency tool so that they can begin this negotiation process,” he said. “And so you’re at least starting to see some downward pressure that’s based upon data that may then kind of trickle its way down to the person, but you can see it’s still pretty upstream right now. That’s where we’ve got to keep on focusing; how is it ultimately going to translate?”

Developers’ interest in the published data is also a source of optimism, Singh and Brennan said. The release of pricing data combined with care quality metrics opens the door to new tools to help buyers determine whether a higher-cost provider is worth the money, they said.

On the other hand, there was plenty of skepticism from the panel’s provider representation around whether the regulations can move the needle on affordability.

Eve Cunningham, M.D., group vice president chief of virtual care and digital health at Providence, pointed to care delivery expenses as the primary factor in hospitals’ pricing decisions.

“The cost of care is the cost of care,” she said. “I get that there [are] variations in the way that cost is presented or the prices are presented, even within the same city. But the fundamental question is does it actually make care less expensive to have transparency. I don’t know if [price transparency] necessarily answers what the actual cost of the care is.”

Singh and Brennan also made a point to note that giving competing hospitals a clearer look at the landscape could backfire on policymakers.

“The opposite could absolutely occur,” Brennan said. “Hospitals are looking at their competitors’ rates and saying ‘Hey, why is that person getting so much more?’ That’s definitely going to happen, it’s just a natural reaction. I think only time will tell but, there is actually a chance that this could be ultimately inflationary, which would certainly not be what people originally intended.”

If there was any consensus across the panel on price transparency’s future, it was that the reams of unorganized rates data payers began publishing last summer are in desperate need of refinement if they’re to be used for meaningful analysis.

“It’s almost like the payer said ‘You want transparency? Hold my beer.' The payer files are absolutely insane, and I say that as somebody who has been working with big data before the phrase was even coined," Brennan said. "You know, Humana had 8 million separate files on their website, it was over 400 terabytes in size [and] the files are refreshed monthly. The Blues plans not only posted their rates but also all the other rates for all the Blues plans.

“It seems, at least in the short term, the only winner from the payer rates is Amazon Web Services because the amount of money it’s costing firms like Clarify and others to download and ingest and store the data,” he said.