Healthcare is expensive. So are cell phones, airplane tickets and automobiles. But what makes healthcare different from these three commonly purchased consumer items?
Unlike healthcare, consumers making purchasing decisions for an iPhone, a plane ticket to Hawaii or Tesla know the exact price of these products when purchasing. For consumers in the United States, knowing the price you will pay for a healthcare service has traditionally been an exercise in uncertainty with patients having no idea how much they would have to pay out of pocket or if a surprise medical bill would arrive in the mailbox weeks after getting care.
Federal price transparency regulations now mandate that hospitals publish insurance specific prices for healthcare services. This effort, coupled with the recently enacted No Surprises Act to address surprise medical bills, has left critics questioning whether these efforts will bring down healthcare costs as if this is the only worthy aim of these initiatives. What critics miss is that this is not just about bringing down healthcare costs but about providing certainty for those engaged in the healthcare purchasing process.
This certainty takes a variety of forms. It can mean needing a common medical procedure and knowing exactly how much will have to be paid directly out of your health savings account. It can mean that a self-funded health plan will know that it is paying competitive prices for the medical services received by its plan participants. It can mean knowing that you will not get a surprise medical bill when you get care from an in-network hospital.
American consumers understand that healthcare is expensive, but the real source of their aggravation is the uncertainty that accompanies this expense. Healthcare price transparency may or may not bring down the cost of healthcare but it is the certainty it introduces that will be the greater benefit to consumers.
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