On October 18, 2022, Turquoise Health released its Price Transparency Impact Report, which outlines the healthcare industry’s progress in meeting price transparency requirements and outlines the path to achieving a industry-wide adoption.
There are currently three regulations that come together and define the landscape of healthcare price transparency: the Final Rule on Hospital Price Transparency, the Final Rule on Coverage Transparency, and the No Surprises Act.
On January 1, 2021, under the final rule on hospital price transparency, hospitals were required to begin publishing their negotiated prices with private insurers. Then, in July 2022, under the final coverage transparency rule, payers were required to disclose their negotiated rates for all items and services for all providers. However, since each of these dates, we have seen varying levels of compliance with the requirements and uncertainty about whether patients are actually using the data to their advantage. Additionally, on January 1, 2022, the Unsurprisingly Law came into effect, which limits the amount that patents can be charged at the in-network rate.
Conclusions of the Turquoise report
In the report, Turquoise reviews price transparency regulations, the innovation that began through third-party organizations, and the additional government actions needed for price transparency to be fully embedded in the healthcare industry.
When it comes to compliance, Turquoise reports that 76% of hospitals posted a machine-readable file (MRF), 65% posted an MRF with negotiated rates, and 63% posted an MRF with cash rates. Of those that are compliant, some of the major healthcare systems (i.e. Mayo Clinic, Advocate Aurora Health, The Cleveland Clinic Health System, and Prime Healthcare) have 5-star MRFs, the highest possible score , meaning they have a full MRF with cash, list and negotiated rates for a significant amount of items and services.
55% of acute care hospitals received a 5-star “complete” rating (a total of 2,264 hospitals), 24% received a four-star “almost complete” rating (a total of 970 hospitals), 8% received a “partially completed” three-star rating (a total of 309 hospitals), and 13% received a “partially incomplete” two-star rating (a total of 544 hospitals).
On the payer side, eighty carriers have published tariffs, including BlueCross BlueShield, United, Cigna, Aetna and Humana.
The ten most wanted services in the third quarter of 2022, according to Turquoise Health, are: implantable heart loop recorder, non-contrast head or brain CT scan, diagnostic colonoscopy, surgical drainage of hematoma or seroma, mammography screening, diagnostic cardiac catheterization , articular arthrocentesis, x-ray of the hip and pelvis, removal of the tonsils in a patient under 12 years of age and computed tomography of the cervical spine without contrast medium.
Turquoise Health noted that at the time of writing the report, the Centers for Medicare and Medicaid Services (CMS) had imposed penalties for non-compliance on only one health system, despite the fact that many hospitals “still significantly non-compliant”. They argue that a “more active stance in penalizing non-compliant systems” is needed, coupled with public recognition of hospitals that are compliant.
Moreover, since, as far as payers are concerned, it is up to each state’s insurance departments to assess compliance with the transparency-in-coverage rule, uniform application is difficult to achieve.
“We anticipate the initial phase of adopting price transparency to take five years,” says Chris Severn, co-founder and CEO of Turquoise Health. The clock started in January 2021 when the first of three different rules and laws that dictate price transparency came into effect. “After seven quarters of transparency, progress is evident. 65% of hospitals published robust negotiated rates. Additionally, 80 carriers have also published rates, representing the majority of lives covered in the United States,” Severn says.
Severn (and the report) conclude that “further government action and third-party innovation are needed to facilitate a competitive health care market. Standards should be adopted for purchasable service packages and machine-readable files in hospitals. »
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