Hoping to deflect the Trump administration's proposed price transparency rule, the Alliance of Community Health Plans is calling for expanding and certifying voluntary price estimator tools offered by health plans.
On Tuesday, the trade group for not-for-profit plans presented a framework for certifying online tools that provide personalized, accurate and easily understandable price and quality information to consumers shopping for medical services. While many health plans and some hospitals already offer price estimators, there isn't a certification process in place.
The alliance hopes it can convince the Trump administration to abandon its proposal to require health plans to disclose their negotiated rates with providers, which both insurers and providers fiercely oppose. Instead, the group wants a voluntary approach that lets plans help patients comparison shop for care by offering reliable estimates of how much it would cost them out-of-pocket to receive care from different providers.
"The average family wants to know is the service covered, how much they'll pay on their deductible and copays, and how far they'll have to drive," alliance CEO Ceci Connolly said. "This is our attempt to move forward on something that matters to consumers."
The CMS did not respond to a request for comment.
The Alliance of Community Health Plans wants consumers to be able to see estimated out-of-pocket costs, relative to their current plan deductible and copays, for a wide range of services and providers in their local area. Price information would have to be updated at least monthly, and would extend to out-of-network allowed amounts.
It recommended the information include quality ratings and provider reviews, though it would give health plans three years to introduce quality data.
While broader use of well-designed price estimator tools would be helpful, some experts believe something along the lines of the CMS' negotiated rates disclosure proposal is still badly needed.
"Showing negotiated rates matters to employers and purchasers in terms of making the marketplace more functional," said Suzanne Delbanco, executive director of Catalyst for Payment Reform.
Niall Brennan, CEO of the Health Care Cost Institute, said the alliance's proposal may be too late to change the administration's transparency push, given that the CMS issued a final rule last November requiring hospitals to disclose negotiated rates for at least 300 "shoppable" services. Hospital groups have challenged the rule in federal court.
"The only thing standing between the current situation and pretty radical provider/payer-specific price transparency is a judge," he said.
The alliance's guidelines would require plans to employ engagement strategies to get consumers to use the transparency tools, including sharing savings with patients who choose lower-cost providers.
Some alliance members such as Priority Health in Michigan and Presbyterian Healthcare Services in New Mexico, already offer such tools.
At Priority Health, more than 20% of commercial enrollees annually use the cost estimator tool, and the plan has paid $10 million in shared savings over five years to its members, said Marti Lolli, the plan's chief marketing officer.
The biggest challenge is getting consumers to use the shopping tool, Lolli said. But its aggressive outreach to members has paid off, and growing use of the estimator also has affected provider behavior, Lolli said. Nearly one-third of Priority's network providers have lowered their prices after seeing they are outliers on particular procedures, with a 9% decrease in average rates for shoppable procedures.
Meanwhile, a growing number of hospitals also are offering online price estimators, often working with vendors such as Recondo, Experian and Change Healthcare. Recondo executives said last year that the Trump administration's price transparency rulemaking has sharply boosted demand for the company's transparency solutions.
A major issue for online price estimator tools is accuracy and reliability, which the alliance's certification guidelines don't address in any detail. Still, a few health plans and providers have gained enough confidence in the accuracy of their estimates that they are considering guaranteeing their estimated price.
"We don't do that today, but we're definitely looking at it," Lolli said.
Estimators currently lack good quality indicators, which would help consumers truly shop for value. The alliance suggested using CMS datasets such as Hospital Compare.
But Delbanco said much better data are needed, particularly information specific to particular diagnoses and procedures and focused on patients under age 65.
While the alliance's certification process recommendation could encourage health plans to develop useful tools, that likely won't alleviate the pressure for broader price transparency, Delbanco said.
"I've heard every argument against transparency, but I don't think we're doing so well without it," she said.