Patients face a different healthcare environment now versus the one that existed before Covid. Health insurance plans traditionally featured low co-pays and minimal enrollee cost sharing which allowed patients to visit any provider in their plan's network and pay the same amount for the same service.
The proliferation of high-deductible health plans (HDHP) has changed this dynamic. HDHPs now constitute the fastest growing percentage of all employer-based health insurance plans with their market share market share increasing from 11.4 percent in 2006 to 55.7 percent in 2021 with their use more concentrated in small businesses.
For employers, an advantage of these plans is their effect on health insurance premiums. By offering an option where employees are responsible for more out-of-pocket expenses, premium growth can be limited, which limits the amount they must contribute to an employee's health insurance premium.
Health Savings Accounts (HSA), which can only be used if paired with a HDHP, permit its user to put pre-tax income into an investment account that can be used to pay for qualified medical expenses. This has also encouraged employer health plan uptake of HDHPs with HSAs serving as a corollary benefit at no extra expense to the plan sponsor.
This increased prevalence of HDHPs means more people paying for a far greater portion of upfront healthcare expenses. And this is why price transparency matters.
For patients, it matters because the need to choose providers based on price, distance and quality now exists. It also matters because the majority of patients in these plans will never reach their plan's deductible limit.
For employers, it matters because of the need to know the contracted rates affecting premiums and the expenses their employees will encounter when visiting in-network providers.
For payers, it matters because of the need to obtain negotiated rate intelligence that facilitates effective provider contract negotiations.
For providers, it matters because patients want it and will gravitate toward hospitals and healthcare providers who deliver it. By using price transparency to competitively price their services, these organizations will induce patient and plan sponsor loyalty and satisfaction by embracing this key differentiator.
With the federal government now mandating that hospitals publicly post payer-specific negotiated rates for healthcare services, consumers, employers and payers can now readily consider these prices, in addition to other factors, when making healthcare purchasing decisions.
If you or your organization is interested in learning more about hospital standard charge and transparency in coverage data, contact HealthPriceCompare to start making price transparency matter for you.