Price Transparency: 9 Trends that Impact Consumer Experience

There is a deep disconnect in price transparency between the normal buying experience for many industries and what happens in healthcare. Consumers are accustomed to knowing prices before they make purchases. A simple internet search will display the total price of the latest smartphone model. Furthermore, consumers expect that price to be consistent throughout the buying journey, right up until the final bill is paid.

That’s not always the case in healthcare. In fact, the amount consumers will owe for a medical bill is typically not determined until after the patient-provider encounter. This can happen weeks and even months after services are rendered. The delay is largely due to the complexity of the healthcare payments ecosystem and the many dependencies that factor into a consumer’s final financial responsibility.

Hurdles for achieving price transparency in healthcare

There are many factors that can influence how much a consumer may pay for healthcare. On the clinical side, price transparency can be hindered by unforeseen factors during the provider encounter. The original price may increase with any complications.

First, does that consumer have health insurance? If yes, then negotiated rates between the payer and provider can dramatically change how much is charged for a patient visit. Deductibles can significantly change the final amount due by the consumer. For instance, the consumer can have a deductible that hasn’t been met. Or maybe the deductible has been met and now co-insurance is applied to the charge. Ultimately, the price of a provider visit can look very different from the amount due on a medical bill.

Put simply, there are many hurdles on the road to price transparency in healthcare. However, the lack of price transparency has a clear impact on healthcare payments and the consumer experience. The nine data points below show just how much of an impact the lack of price transparency is having on the consumer experience in healthcare payments.

How a lack of price transparency affects the consumer experience: 9 key trends

1. 87% of consumers were surprised by a medical bill. (InstaMed Consumer Healthcare Payments Survey 2021)
2. Surprise medical bills average $750 to $2,600. (U.S. Department of Health and Human Services)
3. 73% of consumers report finding out about cost after care. (West Health-Gallup)
4. 9 in 10 consumers want to know payment responsibility upfront. (InstaMed Consumer Healthcare Payments Survey 2021)
5. 61% of consumers said their providers did not ask about affordability of healthcare and/or discuss resources to assist with costs. (CVS Health)
6. 23% of consumers do not know how to look at their health plan to understand out-of-pocket costs. (CVS Health)
7. Most adults (91%) do not know that hospitals are required to disclose the price of care. (Peterson-KFF)
8. 85% had not gone online to research the price of treatment at a hospital. (Peterson-KFF)

The verdict on price transparency and consumer experience in healthcare

The trends in healthcare payments clearly show just how much consumer payments are impacted by the lack of price transparency in healthcare. The price of a provider visit can look very different from the amount due on a medical bill.  If the goal is to make healthcare payments more transparent to consumers, listing the prices of healthcare services will not move the needle in a meaningful way.

Regardless, price transparency continues to dominate the conversation surrounding consumer payments in healthcare. Whatever the ultimate solution may be to the consumer payment experience, the lack of transparency in healthcare has a clear impact on the consumer experience in healthcare.