If you’ve ever tried to make an informed, rational decision about your healthcare options, including price comparisons of insurance plans and the fees charged by doctors, clinics and hospitals, the lack of useful information should make it clear that the time has come for increased transparency in healthcare.
Lack of transparency in pricing structure is only part of the problem. We all stand to benefit from greater access to relevant information about topics such as physician performance and the relative efficacy of different procedures and medications.
With an increase in consumer directed health plans, health reimbursement accounts, and new healthcare regulations, there is a strong need for more pricing transparency. Consumers expect to be able to quickly compare prices and find reviews for the goods and services they want to purchase, except in the area of healthcare. There is a wide discrepancy in the price and costs of healthcare. For example, patients who receive the same exact hospital care are charged three different prices depending on their level of coverage: government plan (Medicare/Medicaid), private insurance or self-pay.
What’s more, transactions costs in healthcare are an astonishing 14 percent, as compared to 2 percent for retail transaction costs. Clearly, there is a need for greater efficiency in the system. Potential solutions include implementing analytical platforms that can quickly churn through enormous amounts of claims data, both in coded form for Medicare/Medicaid and private insurance, and unstructured information from providers. Multiple payment networks for patients, such as Paypal, BillMeLater and credit card networks will also help to make the system work more efficiently.
A company on the forefront of change is InstaMed, a healthcare clearinghouse and payment for providers and payers. InstaMed’s integrated network allows thousands of practice and payers electronically transfer funds which increase efficiencies and speed of payment for all parties.
Access to Relevant Information
With the introduction of higher deductible healthcare plans and a variety of health reimbursement accounts, employers and employees need better and more specific information to make informed decisions. For example, consider a patient seeking knee replacement surgery. They need specialist care, diagnostic testing, a surgical procedure, time in the hospital and medication. The provider and payer should be able to give the patient relevant statistics on physicians, as well as quality of care reviews.
With increased transparency in medical information, facilities with lower-rated doctors will take steps either to improve their performance or replace them with better-performing physicians. An employer seeking to keep costs down will want to provide employees with better data and decision-making tools. Insurance companies will want to work with physicians who make the least amount of mistakes and who manage resources the most efficiently. Possible solutions include:
1) setting up highly integrated benefits programs for employers that tie into the payer, provider and pharmacy networks;
2) harnessing social networks to share information; and
3) simplifying information for all stakeholders.
This will help people answer such questions as, how good is this doctor at this procedure, and what are my physicians’ overall ratings? How can I receive less expensive medications? Why does your procedure cost more than in another care setting? How much do you make from each procedure? If I choose a different provider, will I be charged less?
One company, Managed Markets Insight & Technology (MMIT), provides formally data to physicians, pharmaceutical companies, and consumers. Providers now have the ability to review a consumer’s benefit plan at the point of care and prescribe the most economical medication for a patient. Similarly, the information is provided to pharmaceutical companies to provide information on how their drugs compare to other plans.
Overall, the continued evolution of the healthcare industry will be achieved through better technology platforms that capture and synthesize information for payers, providers, employers and employees. Organizations that get started earlier in giving out this data will be the winners, and those that hoard information or refuse to take full advantage of it will become less competitive in the marketplace.
This article was originally published by NJTC.