How much health insurers pay for almost everything is going to be universal

Consumers, employers, and everyone else interested in health care prices will soon have an unprecedented view of how much insurers pay for care, perhaps helping to answer a question that has long plagued those who purchase insurance: Are we the best deal for us? Got it?

From July 1, health insurers and self-insured employers must post on every priced website that they have discussed item by item with healthcare service providers. Prices for prescription drugs excluding drugs administered at the hospital or doctor’s office are excluded.

Releasing federally required data can affect future prices or even how employers contract for health care. Many will see for the first time how well their insurers are doing compared to others.

The new rules are much broader than those that came into effect last year so that hospitals have to post their discussed rates for public viewing. Now insurers must “post the amount paid for each physician, every hospital, every surgery center, every nursing facility in the network,” said Jeffrey Leibach, a partner at consulting firm Guidehouse.

“When you start doing math, you’re talking trillion records,” he said. The fines that the federal government can impose for non-compliance are heavier than the penalties that hospitals face.

Federal officials have learned from hospital experience and provided further guidance on what was expected of insurers, Lebach said. Insurers or self-insured employers can be fined up to $ 100 per day for each breach, if they fail to provide data, for each affected registrant.

“Take out your calculator: all of a sudden you’re in the millions fast enough,” Leibach said.

Assigned consumers, especially those with high-discount health plans, may now try to dig in and use the data to try to compare what they have to pay for different services at different hospitals, clinics or doctor’s offices.

But the sheer size of each database can mean that most people will find it “very difficult to use data in a concise way,” said Katherine Baker, dean of the Harris School of Public Policy at the University of Chicago.

At least first.

Entrepreneurs are expected to quickly translate the information into a more user-friendly format so that it can be incorporated into new or existing services that estimate costs for patients. And as of January 1, the rules require insurers to provide online tools that will help people get advance cost estimates for about 500 so-called “shoplifting” services, meaning they can provide pre-arranged medical services.

Once these things happen, “at least you will have options in front of you,” says Chris Severn, CEO of Turquoise Health, an online company that has posted pricing information available under hospital rules, although many hospitals still have compliance.

With the addition of data from insurers, sites like this will be able to drill more from one place to another or at a different cost to insurers.

“If you’re going to do an X-ray, you can see that you can do it at this hospital for $ 250, at the imaging center down the street for $ 75, or at your specialist’s office for $ 25,” he said.

Everyone will know about each other’s business: for example, how much insurance does Aetna and Humana provide to the same surgery center for a knee replacement.

The requirements stem from the Affordable Care Act and the 2019 executive order of then-President Donald Trump.

“These plans are supposed to work for employers to negotiate a better rate, and the little insight we have shows that this has not happened,” said Elizabeth Mitchell, president and CEO of Purchaser Business Group on Health, employers who are job-oriented. Provides health benefits. “I believe the dynamics are going to change.”

Other observers are more cautious.

Jack Cooper, director of health policy at the Yale University Institution for Social and Policy Studies, said, “Perhaps this will best reduce the wide variety of prices.” “But it won’t reveal a consumer revolution.”

Still, the biggest value of the July data release is how successful insurers can shed light on price discussions. It comes down to the heels of research that has shown tremendous variation in what is provided for health care. For example, Rand Corp. A recent study of this shows that employers that offer job-based insurance plans are on average 224% more than Medicare for the same services.

Thousands of employers who have purchased insurance coverage for their employees will get this more complete price picture – and may not like what they are seeing.

“What we’re learning from hospital data is that insurers are really bad at negotiations,” said Gerard Anderson, a professor of health policy at the Johns Hopkins Bloomberg School of Public Health. The care of the hospital may be more than the benefits that are taken from them.

This can add to the frustration that Mitchell and others say employers have with the current health insurance system. More may try to contract directly with the providers using insurance companies for claim processing.

Other employers can bring their insurers back to the bargaining table.

“For the first time, an employer will be able to go to an insurance company and say, ‘You haven’t negotiated a well-adequate contract, and we know because we can see the same provider has a good contract with another company,'” said James Gelfand. President of the ERISA Industry Committee, a trade group of self-insured employers.

If so, he added, “patients will be able to save money.”

That is not necessarily a given, however.

Because there has not been much effort in healthcare prior to the release of such pricing data, it remains uncertain how it will affect future spending. If insurers are returned to the bargaining table or providers see where they stand compared to their peers, prices may fall. However, some providers may raise their prices if they see that they are charging less than their peers.

“The downward pressure may not be a given,” said Kelly Schultz, AHIP, vice president of trade policy for the industry’s trade lobby.

The University of Chicago Baker says that even after the data is out, rates will continue to be greatly influenced by local conditions, such as the size of an insurer or employer – providers often offer large discounts, for example, to insurers or self-insured employers who can send them the most patients. The number of hospitals in an area is also important – if there is only one in an area, for example, this means the facility can usually claim a higher rate.

Another unknown: will insurers meet deadlines and provide usable data?

Schultz said at AHIP that the industry is on a good path, partly because the original deadline was extended by six months. He expects insurers to do better than the hospital industry. “We’ve seen a lot of hospitals that have decided not to post files or make it difficult to find them,” he said.

So far, more than 300 non-practicing hospitals have received warning letters from the government. But they could face fines of up to $ 300 per day for failing to comply, less than what insurers are likely to face, although the federal government has recently fined up to $ 5,500 a day for the biggest benefits.

Even after the pricing data became public, “I don’t think things will change overnight,” Leibach said. “Patients are still going to make care decisions based on their physician and referrals, for many reasons besides price.”

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