An unexpected group pushed BCBS of North Carolina to expand its price transparency efforts. “Physicians desperately wanted it,” Caveney said. Doctors sought more transparency because it would help them as they enter value-based contracts. Internists, for instance, could use the price information to change their referral patterns by looking for high-quality labs or physician specialists offering lower costs.
The North Carolina Blues effort comes amid a wave of transparency tools developed by entrepreneurs, health insurers and states to give patients and employers more ability to shop around. In February, the Health Care Cost Institute launched a website called Guroo, which enables consumers to search for average prices for 70 services in more than 300 cities. Prices are drawn from medical claims for 40 million Americans covered by Aetna, Assurant Health, Humana and UnitedHealthcare. Consumers can identify the low, average and high prices within each market, including all services to treat certain conditions.
But useful price information for consumers remains unavailable in many parts of the country, with some price transparency tools showing only the retail prices providers charge, not the actual amounts paid by insurers.
Ray Desrochers, chief marketing officer at HealthEdge, a software company that works with insurers on backend tasks, said that not only should health plans give their members price data, but they also need to ensure consumers actually use the information effectively.
Last year, Priority Health, the health insurance arm of Spectrum Health in Grand Rapids, Mich., launched a price transparency tool for its members. The tool shows them the average market rates for area providers for 300 procedures and how the costs will affect their out-of-pocket payments. In July, Priority Health started a rewards program to steer members to lower-cost providers and settings. They can earn a Visa gift card worth up to $200 if they select a provider offering a below-average market price. “We really want engaged members,” said Joan Budden, chief marketing officer at Priority Health.
Caveney said BCBS of North Carolina's transparency tool helped expand the insurer's membership base, particularly on the state's insurance exchange. People were able to see the prices of in-network providers before they made a final enrollment decision. The insurer has more than 380,000 exchange members, accounting for three-quarters of the state's total.
The insurer's price data release drew criticism and questions from some high-cost providers and even from some consumer advocates, who said the pricing data weren't adequately explained. Caveney said the criticisms led to good discussions with providers and members to “check the integrity and accuracy of our databases.”
Now, the insurer hopes to improve the transparency tool by offering additional data on utilization and outcomes patterns for particular providers because price alone doesn't reveal whether a provider delivers value. “Maybe Hospital A is $100 cheaper for an MRI, but doctors at Hospital A order a heck of a lot more,” Caveney said. “We don't know whether every one of those was appropriate or necessary.”
