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Deeper Into Price Transparency

As covered before, the Price Transparency initiative by CMS is only the first step towards redefining healthcare and how all stakeholders engage including patients. Like the mask mandate in the initial stages of COVID, it only works if there is compliance. Also, remember this is a progressive multi year model to include all service by 2024*.


We are continuing to see more engage in utilizing the Price Transparency data for effective planning and strategy. Others are using the data for leverage for “fair” payment rates as compare with others. Vendors are seeing that likely their margins will change as well as their strategy. Payers know that it will reduce member barriers.  


Then we have the people that say it is just “more data” or patients will never understand it. This is 100% correct, if you do not have a clinical and administrative team like our Oncospark Team to create the relationships and context, then comprehension will be difficult. Once we have a clear path, then we educate patients, not wait for them to figure it out. Most of the time our patients don’t know their payer coverage until they need services.


Understanding the current financial structure of the hospital and providers is imperative for meaningful data.

  • Payer mix
  • Bad debt
  • Charity care
  • Investments & mergers
  • Operational costs and margins
  • Networks and contracts

So, just the data (as above) has little to no meaning to anyone. What about inclusion of all services for a patient or and entire course of treatment? Again, this is only the first step—end goal-- right service, right price, right time.


As providers are feeling the financial impact, they are looking at their expenses. Around 50% of a hospital’s expenses are fixed salaries/wages/benefits. Could this data allow them to negotiate more accurate rates for their staff and employees and even propose new models besides the current “normal plan” and “high deductible plan”? This info is based on clinical and $$$$ data.


The data has already established because more is charged, or more is paid doesn’t mean there is any a better outcome. An MRI is an MRI, right. Assume the equipment is the same (1.5T magnet). The Medicare rate is consistent. The commercial rate has a large range from $315 to $4000. Understanding that commercial rates are negotiated by the provider or network, what is the quantifiable “true value” difference to the patient.


Power in Numbers. This was a foundational reason for mergers and acquisitions in healthcare. Having a larger provider pool and patient catchment area would result in the ability to negotiate/leverage better payment rates as well better supply buying rates. This makes sense but is a very short- term strategy and does not “solve” the problem. These initiatives are singularly focused and miss the alignment of patient access and value-based care.


Direct payer contracting and inclusion models already exist and will continue. Setting accurate rates for these are dependent upon the quantity and accuracy of the data. Could cash only models or direct prompt pay models work in the hospital? They work in other avenues of healthcare like dentistry.  All-inclusive care models are being set up by providers now for things like orthopedics. This cuts out much of the redundant process which costs time, money, and delays in care. Providers and patients have the potential to save money while maintaining viability.


In working with different vendors and vendor representatives, I have heard:

  • This will stunt innovation
  • We will simply pass cost on to the consumer or client


The first is untrue if enough data is present and the second already occurs. Margin analysis will be required, and reductions are probable. This is no different than the “waste” reduction we are seeing for providers. This is part of the correction. The delay in this foreseeable correction over the years makes the “change” more impactful now. If providers are being held accountable and rates are dependent on value/outcomes and patients are paying more for their coverage; then why would a reassessment from vendors not be a given. Value is the name of the game and may be a tough pill for some to swallow. Under fee for service a business model may make sense, but for value-based care or all inclusive payment models the value may no longer be present. So, “use it because you can bill it” goes away.


To make progress towards VBC that is actually sustainable the the data is needed. That is step 1.

Our EvaluPrice Platform provides the data needed for these assessments and strategic models.


We have also started using this data to decrease some of the burden of prior authorization. Knowing rates and connecting them to outcomes/clinical data, and total cost of care is valuable for both patients and the provider.

Accountability will be required by all stakeholders in the patient’s care path.

Commitment to the goal of value, quality, and transparency will only be meaningful through action.


*Anthem Blue Cross

Anthem is already anticipating the changes and setting their own internal deadlines and benchmarks

For plan years that begin on or after January 1, 2022 – Plans and issuers must make three separate machine-readable files in a standardized format available to the public, including stakeholders such as consumers, researchers, employers, and third-party developers. The three files must be placed on a publicly available website and updated monthly.


  • Negotiated in-network provider rates for all covered items and services
  • Historical payments to, and billed charges from, out-of-network providers
  • In-network negotiated rates and historical net prices for all covered prescription drugs by plan or issuer at the pharmacy location level.

Beginning January 1, 2023 – Plans and issuers must make personalized out-of-pocket cost information and the underlying negotiated rates for 500 covered healthcare items and services, including prescription drugs, available to participants, beneficiaries, and enrollees. This information must be available through an internet-based self-service tool and in paper form upon request.


Beginning January 1, 2024 – Health plans must expand their transparency tools to encompass all covered items and services.