The Centers for Medicare & Medicaid Services (CMS) recently proposed a rule that would require hospital websites to provide consumer-directed information on rates negotiated with specific payers for 300 specified health care services that are considered “shoppable” (e.g., maternity care, knee replacement). Based on our experience supporting price transparency efforts in New York State, NYHealth provided the following public comments to help CMS ensure an optimal roll-out of the proposed price transparency efforts:
September 26, 2019
Seema Verma
Administrator, Centers for Medicare & Medicaid Services
U.S. Department of Health and Human Services
200 Independence Ave., SW
Washington, DC 20201
RE: CMS-1717-P
Dear Administrator Verma:
On behalf of the New York Health Foundation (NYHealth), a private, independent philanthropy, I am writing to provide comments on the proposed rule (CMS-1717-P), specifically, Section F. Proposed Requirements for Consumer-Friendly Display of the Payer-Specific Negotiated Charges for Selected Shoppable Services. The proposal would require hospital websites to provide consumer-directed information on rates negotiated with specific payers for 300 specified health care services that are considered “shoppable.”
We applaud CMS for taking action to ensure consumers have access to relevant pricing information from their health care providers. This step marks an important milestone on the journey to full, system-wide price transparency. NYHealth supports efforts to empower consumers to take a greater role in their personal health care experience. We offer considerations for CMS based on our own experiences supporting price transparency efforts within New York State.
NYHealth believes that information transparency is a gateway to improving affordability, quality, and competition in the health care system and a better health care system for all Americans. Our program on Empowering Health Care Consumers is focused on promoting transparency of health care price, quality, and patient experience information.[1] We support projects to develop information resources for patients, expand access to and uptake of those resources, and encourage diverse stakeholders such as plans, providers, and policymakers to advance transparency in health care.
A national and state-level survey by Public Agenda, co-funded by NYHealth, found that the majority of Americans are searching for price information in health care. Even among those who had never looked for price information, the majority indicated that they want to know how much a medical service will cost them before receiving the service; they simply do not know where to look.[2] The survey also found that nearly two-thirds of Americans don’t believe that there is enough price information about how much medical services cost.
While hospitals currently must provide their chargemaster rates, these rates are less useful to consumers than negotiated rates, as the chargemaster rates are almost never what the consumer actually pays. Patients with some form of health insurance pay a portion of the rate that their insurer has negotiated with the hospital. Hospitals are also generally willing to negotiate rates with uninsured or self-pay patients. As a result, the chargemaster rates are not applicable to either the average insured or uninsured consumer.
Opponents of price transparency raise the possibility that overall health care costs will increase once individuals see the prices for services. There is a belief that consumers will choose higher-priced care, believing it to be a proxy for better quality. However, more than half of Americans who have tried to compare prices say they chose a less expensive service.2 With the prevalence of high-deductible and consumer-directed health plans on the rise, consumers are on the hook for greater portions of their health care bills.[3] For many, this has resulted in having to forgo or delay care. Now more than ever, consumers have both a vested interest in and a right to know what their care will cost them.
According to the Public Agenda survey, health care consumers in New York view providers, including hospitals, as a trusted source of information about the price of medical care.[4] Several pioneering hospitals have already created online tools to assist patients in determining their financial liability before receiving care.[5] Many of these hospitals make price information available for more than 300 services. Some health care systems have even taken the step to guarantee the price quote if patients pay for services before their insurance companies are billed.[6] These exemplar hospitals demonstrate that CMS’s proposed requirements are possible to accomplish.
However, these efforts are still rare. Because price transparency tools do not aid consumers in price-shopping unless they have multiple prices to compare within one geographic area, the availability of these prices must be universal to achieve the goal of minimized health care spending. The federal government’s ability not only to require transparency, but also to provide guidance, will make this task more effective and ensure it happens in a timely manner. An evaluation of a price transparency mandate in Massachusetts found that lack of leadership and guidance from the government was a significant reason that the initiative struggled to take hold, stating, “government leadership on transparency could have helped to direct greater compliance, generate more innovation in this area, and further engage the public.”[7]
Effective price transparency requires systemic change. Below, we highlight some best practices that have been learned from prior transparency efforts, as well as additional considerations for CMS to undertake in order to ensure an optimal roll-out of these efforts over time:
- Public outreach efforts, content generation, and coordination with existing user channels are needed to educate and engage audiences. Audience engagement has proven challenging for transparency tools, as reflected in low use rates. Building a website alone is insufficient to foster changes in consumer behaviors. Hospitals should make efforts to advertise this tool to patients and generate interest. Most hospitals already market directly to consumers, so channels for patient engagement are in place. These channels should be used to introduce the tool to the patient population.
- Tools should offer universal availability without a login. The tool should be available to all consumers seeking care, regardless of whether they currently have an account within a particular health care system. Keeping negotiated rates behind a login-required “Patient Portal,” or any other requirements to create an account or register as a patient within the system before viewing these rates, will prevent many consumers from accessing price information. The rule currently states that “users would not have to input information (such as their name, email address, or other [personal identifying information]) or register to access or use the standard charge data.” We suggest that in addition to not requiring personal identifying information, users should not be required to use any form of account, username, or password.
- Ease of use is key and innovative designs promote usage. A tool is only helpful if people know where to access it and how to use it. Intuitive designs are key, as is prominent display. An evaluation of price transparency tools found that the more effective tools had an easy-to-find link on the website home page for the organization responsible for publishing the information. Moreover, there should be clear indicators such as “Price Check” or “Cost Estimator” in the text for the link. Price information was not as easily found when the user had to click a “Tools and Resources” link on the home page to use the cost estimator.7 Ensuring that the link to the tool is prominently featured on the hospital home page and uses plain and obvious language will help ensure that consumers can find it.
- Information must be available in multiple languages. To maximize the total number of consumers able to use these tools, the information should be available in multiple languages. This includes the search descriptions, as well as any contextual information that hospitals provide to help patients understand the price information. Each hospital best knows the needs of the patients it serves and should be responsible for ensuring that most patients have access in their preferred language.
- Standards must be in place for monitoring and evaluation of impact. It is critical for CMS to monitor and evaluate the impacts of these tools—not only to help ensure there are not unintended effects, but also to identify best practices. This includes developing a better understanding of any potential misinterpretations of the data by patients, as well as the extent to which hospitals may misrepresent rates. CMS should also have a system in place to ensure that rates are being updated regularly in accordance with the proposed rule.
As consumers shoulder increased financial burdens of their health care, the demand for consumer-friendly price transparency tools will grow. To maximize efficiency of the health care system, consumers must know the prices they will pay for care. Some hospitals are already providing this information, but others must be compelled to do so in order to create a truly transparent and functional health care market for all Americans.
Thank you for the opportunity to provide input on this important matter.
Respectfully submitted,
David Sandman, Ph.D.
President and CEO
New York Health Foundation
[1] New York Health Foundation, “Empowering Health Care Consumers,” https://nyhealthfoundation.org/what-we-fund/empowering-health-care-consumers/, accessed September 2019.
[2] Public Agenda, “Still Searching: How People in New York State Use Health Care Price Information,” https://www.publicagenda.org/files/PublicAgenda_HowPeopleinNewYorkStateUseHealthCarePriceInformation_2017.pdf, accessed September 2019.
[3] Centers for Disease Control & Prevention, “High-deductible Health Plan Enrollment Among Adults Aged 18–64 With Employment-based Insurance Coverage,” https://www.cdc.gov/nchs/products/databriefs/db317.htm, accessed September 2019.
[4] Public Agenda, “Still Searching: How People in New York State Use Health Care Price Information,” https://www.publicagenda.org/files/PublicAgenda_HowPeopleinNewYorkStateUseHealthCarePriceInformation_2017.pdf, accessed September 2019.
[5] For example: Mayo Clinic, “Cost Estimator,” https://costestimator.mayoclinic.org/, accessed September 2019; Geisinger, “Estimated Costs & MyEstimate® Tool,” https://www.geisinger.org/patient-care/patients-and-visitors/billing-and-insurance/tools-to-use/estimated-costs, accessed September 2019; University of Colorado Health System, “Billing and pricing information,” https://www.uchealth.org/billing-and-pricing-information/, accessed September 2019; UHealth University of Utah, “Estimate Your Out-of-Pocket Costs,” https://healthcare.utah.edu/pricing/calculate.php#/, accessed September 2019.
[6] St. Luke’s University Health Network, “Price Checker,” https://simpleepay.com/providers/stlukes/estimations#/, accessed September 2019.
[7] Pioneer Institute, “MA Health Insurers Have Made Good Progress in Price Transparency, But Significant Work Remains,” https://pioneerinstitute.org/download/ma-health-insurers-have-improved-their-consumer-price-transparency-efforts-but-significant-work-remains/, accessed September 2019.
