Real transparency is the single, first, and most important step toward bringing down healthcare costs and creating a competitive marketplace.
Americans cheered last month when President Donald Trump, surrounded by independent doctors and patients, signed an executive order on “Improving Price and Quality Transparency in Healthcare.” The order, to quote Trump, “is pretty much going to blow everything away.”
But it won’t if the major forces fighting transparency prevail.
See, not everyone celebrated the executive order. The Opacifiers, what I call those who profit from keeping Americans in the dark, were not cheering. They were lawyering and lobbying up, busily working to undermine, narrow and water down the order. They are not going to give up the hundreds of billions of excess dollars flowing their way easily.
That’s why, over the next several months, those of us who want price transparency, in other words everyone else, need to stay vigilant.
Real transparency is the single, first, and most important step toward bringing down healthcare costs and creating a competitive marketplace. When consumers have access to real prices and outcomes, and can shop for value the way they do in every other industry, they will have the power to heal our sick health-care system.
Empowered with facts, consumers will move away from large health systems that layer in facility fees, and that consolidate by buying up doctors and other hospitals to gain market control and eliminate competition. Instead patients will move toward independent doctors and free-standing facilities and other affordable, high-value options.
Once patients can choose to have a baby for $5,000 instead of $42,000, or an MRI for $350 instead of $3500, the Opacifiers are going to lose money. Which is why they are working triple time to derail, detract and dilute the order’s intention, and undermine any hope of achieving true transparency.
Timing Is Critical
Sixty days from the June 24 signing of the executive order, U.S. Health and Human Services Secretary Alex Azar needs to have written the regulation that will require hospitals to publicly post charges, including negotiated rates from insurers, in an “easy-to-understand, consumer-friendly” format.
Now, you would think the latter would go without saying; however, you may recall, in January, the Hospital Price Transparency Rule went into effect requiring hospitals to post their prices in “machine-readable” formats. Well, they did-sort of. Many squirreled their price lists deep in the labyrinths of their websites, and then posted indecipherable codes that were not only impenetrable but also incomparable to other institutions-all by design. What makes you think they will cooperate now?
Azar faces some strong headwinds, including policymakers who get millions from the Opacifiers’ special interest groups. A look at OpenSecrets.org shows that the American Hospital Association, the American Medical Association, Pharmaceutical Research & Manufacturers Association, and Blue Cross/Blue Shield have been among the top 10 lobbying spenders for the last 20 years. In 2018, they ponied up over $20 million each to encourage lawmakers to maintain the opaque status quo. That’s why Congress was never going to get this done. We needed an order from the top.
As momentous as this achievement is, the deal is far from done.
The Opacifiers are trying to inject wording into the policy language to render the order impotent.
War of the Words
Here are some examples of the weasel words we need to watch for and block:
Americans need access to real prices and real outcomes data so they can comparison shop for value. However, the Opacifiers are trying to muddy the language and call for “price averages,” “typical prices,” “median prices,” and other useless information. What good is knowing the average price of an MRI in your town, if you don’t know where the most affordable one is? They also want to list “cost estimates” instead of real prices to add more fog to the numbers.
“What you will actually owe”
The Opacifiers would also like to swap out requirements to reveal total costs of care for language that would require disclosure of only what patients will actually owe. They argue that patients don’t care about or need to know the total costs, only their out-of-pocket costs. This is, of course, a diversionary tactic to turn our attention away from total costs, which do matter. One in 10 Americans has no insurance. Many others have high deductible plans and often face the full bill. Those patients care about total price. Regardless, we all still pay for the high costs of health care through higher premiums, higher taxes, and the higher costs of goods and services.
“Most common (or shoppable) procedures”
Consumers want and need to know prices for all health-care services. But the Opacifiers say that is simply too much information, so propose posting prices for only “the most common procedures.” Is that the most common 100 procedures, 30 procedures or 10 procedures? The fewer the better, as far as they’re concerned. They also suggest that only prices for “shoppable” procedures get listed, creating a false assumption that some services are not shoppable.
“It’s too complicated”
A common refrain among the Opacifiers is that health-care data is simply too complex for consumers to navigate. Sorry, but anyone familiar with Google, Amazon, Alexa and Uber knows that modern technology can synthesize huge data sets quickly and put useful information right into our hands via our smart phones.
“Prices will go up”
The argument that price transparency will cause prices to go up might be worth our attention if economic studies, history, common sense and experience didn’t all universally demonstrate the opposite. Price transparency allows for true competition, which brings prices down.
Yet Opacifiers insist that once confidentially negotiated rates are exposed (you know, those top-secret prices you see in your Explanation of Benefits forms after it’s too late to negotiate price), that other insurers will see that their competitor is paying less and demand lower rates.
You laugh. But the forces opposing real transparency are powerful, insidious, well-funded and relentless.
As the words of this executive order get hammered out over the next two, four and six months, pay close attention. Watch for weasel words.
When the rule is written and the public comment period opens, expose them, then flood the Federal Register with comments that support real transparency and a truly competitive health-care market.
This is our moment, America. Prepare for a long and formidable fight. One we can’t afford to lose.
Marni Jameson Carey is the Executive Director of the Association of Independent Doctors, a national nonprofit working to stop consolidation in health care and save the practice of independent medicine. You may join AID here and contact the author at firstname.lastname@example.org.