Letters: Hospitals need access to accurate cost-sharing information

Regarding the Sept. 30 editorial “Action in the face of inaction,” hospitals and health systems understand—and share—consumers’ frustrations with understanding how much they will be expected to pay for care. And that’s why the field has advocated for solutions.

Hospitals are working to supply information on consumers’ expected out-of-pocket costs. In addition to having counselors to provide information, many hospitals provide online tools to help patients obtain cost information; others are working to develop them.

But we can’t supply accurate, useful information without insurers stepping up. That’s why we’ve urged policymakers to remove the most significant barrier: provider access to accurate cost-sharing information. Insurers know what an individual pays given their specific benefit design and where they are in meeting their deductible, yet providers routinely struggle to get this necessary information. Often, requests are ignored or providers receive incomplete or inaccurate information.

The government can help by explicitly requiring insurers to respond to all inquiries with up-to-date information and to develop a secure and accurate out-of-pocket cost estimator tool for providers. This would go a long way toward enabling hospitals to generate a patient’s specific out-of-pocket cost information.

We also understand the frustration patients have related to surprise medical bills. That’s why, unlike other groups, we very much want this issue addressed this year by Congress. That’s why protecting patients and taking them out of the middle of negotiations between providers and health plans was at the top of the list of guiding principles we shared with legislators earlier this year. In addition, insurers should maintain adequate networks for access, which rate-setting proposals currently under consideration would inhibit.

While some criticize us for opposing some of the Trump administration’s proposals, when it acts without the legal authority to alter a congressional policy, it is up to us to challenge it. Whether it’s about adequate payments for different sites of care, protecting coverage, preserving the integrity of 340B, or clearing the nearly endless Medicare appeals backlog, these programs support hospitals’ ability to serve their communities and deserve a vigorous defense.

Rick Pollack
President and CEO
American Hospital Association

Regarding “Lopsided urban hospital markets spark cost concerns,” once again the ivory tower researchers were profiling prices for only one-third of the hospital patients. I wish they would put down their clipboards and try running a health system and understand pricing from the system’s perspective instead of just trying to make headlines.

According to the CMS, the cost of running hospitals increases by 2.5% per year (i.e., the marketbasket.) Since 2014, the blended rate increase for health systems from all payers is about 1% per year: 31% of gross revenue from commercial payers averaging a 2.5% negotiated rate increase per year (if lucky.); 21% of gross revenue from Medicaid/self-pay that pays 65% of cost with no increase over the past five years; and 48% of gross revenue from Medicare that pays about 80% of cost averaging 1.5% increase per year.

And please stop with the “hospitals can break even on Medicare” nonsense. The CMS overestimates health system margins using data from hospitals’ Medicare cost reports, which exclude essential costs health systems incur, including the cost burden of physician employment (necessitated in part by the stingy 0%-1% annual increases in the Medicare physician fee schedule over the past decade).

As Steve Jobs once noted, people who make recommendations without the experience of actually working in that business are extremely limited because they never really get a full understanding of that business and its pricing complexities.

Nathan Kaufman
Managing director
Kaufman Strategic Advisors

Regarding “Verma has a point; Americans are fed up with healthcare industry,” your headline does a great disservice to the dedicated employees and providers in the healthcare industry. The article talks about some isolated cases of balance billing and issues with provider networks.

Very few patients are upset with the actual care they receive and their caregivers. Most complaints come after the service is provided and the bill arrives. That is a totally different issue than saying Americans are fed up with the entire industry.

David Henry
President and CEO
Northern Montana Healthcare