A long way to go in price and quality transparency

Providing price and quality information is viewed as a Holy Grail among health plans and providers, who see transparency as the key for igniting health care consumerism. However, that Grail remains elusive, as issues of tool usefulness and consumer trust cloud the market."A Health Plan Work in Progress: Hospital-Physician Price and Quality Transparency," a report from those indefatigable folks at the Center for Studying Health System Change (CSHSC), explains that health plans are ramping up transparency efforts in what is still an early phase of market development and adoption.


CSHSC looked at two aspects of transparency: price and quality. For
larger plans, who are more advanced in their price publishing projects,
these efforts are seen as crucial for competitive positioning,
according to CSHSC; for smaller plans, they’re defensive in nature.
Regardless, very few plans are providing price data that’s customized
for enrollees.

One broker in CSHSC’s study commented, "Price information is sparsely available, and where it is available, it’s of relatively low utility for the average member." That’s the bottom line of the study.

The area of quality appears to be more mature, according to CSHSC. Still, the drag on proliferating quality data is that providers can push back on a provider’s ‘poor quality’ determination. Perhaps that’s why there’s more hospital quality profiling being done than physician quality data being pushed out to enrollees. The study found that most plans tend to rely on nationally reported quality data from third parties (e.g., Medicare, HealthGrades, or Subimo). It can be a pass-the-buck strategy for the health plan, who might say, "this isn’t our rating, this is Medicare’s."

The study smartly points out that there are risks in being transparent. Consumers could misinterpret the data; for example, believing that a higher price equates to higher quality. Other consumers might not know how to evaluate or use the data in decision making. Finally, there is liability risk in that unhappy providers might push back in the form of lawsuits (as was the case recently with the Washington State Medical Society suing Regence BlueShield).

Jane’s Hot Points: Low utility, indeed. Can you spell "r-e-l-e-v-a-n-t?" Why should consumers tune in to price information if it’s not directly useful to them? Averages are only relevant to those who pay those prices.

One plan that has lots of physician data is Medicare, the granddaddy of all health plans. However, Medicare doesn’t release physician-specific data to the public.

While transparency is seen by a broad range of health stakeholders as playing a major role in empowering health consumerism, we’re not there yet. Not even close.

4 replies »

  1. The pricing transparency (and to a lesser degree quality transparency) is a really an infrastructure issue. No where in the entire EDI food chain are the IT systems ready to handle a “real-time” environment that would being to make pricing transparency a reality and this isn’t going to change even with the 5010 HIPAA transactions beginning to be implemented.

  2. A lot of the data upon which the cost and quality data is based in OLD…years OLD.
    It’s not very useful to give consumers/purchasers information for the cost and quality of care that an organization provided in 2005…
    Solucient “Top 100” lists and the like are similarly useless for contemporary decision making. They had good quality 3 years ago…we’ll have to wait a couple of years to see if they still have good quality…

  3. Jane – A well done recap of HSHSC’s piece, and am in complete agreement with the conclusion. We are not even “close” to achieving the ostensible benefits of consumer empowerment afforded by such end user “information”.
    The notion of consumer empowerment is overplayed and primarily a swan song of the insurance industry and their banking co-conspirators, who need to keep the idea of HDHP’s and HSA’s alive and well and in the market place of private solutions to the failing health care system.
    There are too many flaws in the existing price and quality data, and providers, especially physicians, can deconstruct the validity of the informational hierarchy, and reported outputs, with a summary “garbage in, garbage out..” characterization.
    More will be revealed; especially who benefits from the continued more of the same, with incremental tinkering at the margins of health system reform. The usual suspects will always be following the money and relentlessly pursuing niche market profitability vs. thinking globally with a strategic rewire of our failed and broken system.
    IMO, such preoccupation is a “Goodman-esque” diversion from genuine solutions.

  4. Many providers and health plans are unwilling to expose (share) true prices for their health care services. After all, isn’t health care transparency “enhanced customer service?” In order for transparency to be implemented successfully across the industry, we really need the industry to be bold, forward focused and willing to give up some control.
    Some guiding principles for transparency:
    (1) Industry needs to focus on consumers
    (2) The effort requires historic collaboration across the industry to share resources
    (3) Must be relevant and valuable to the consumer
    (4) Requires significant culture shift
    Mona Lori