Hospital Bill: Price Transparency Now in Effect

Will the new policy help consumers?

By Deborah Jeanne Sergeant

As of Jan. 1, health care providers have been required to post the price of their services online and make the prices available to anyone who asks.

Instead of receiving services and having to wait for the bill, patients can know what some of their visits, procedures or tests cost.

The movement toward transparency was largely patient-led, as more and more patients have become uninsured or have otherwise taken on more financial burden of paying for their health care through high deductible plans in the wake of the Affordable Care Act.

Tammi Imm, CPA, vice president of front end revenue cycle at Rochester Regional Health, said that patients struggle to understand the cost of care, and even more so now that many are paying more of the tab.

“In the past, they weren’t incentivized,” Imm said. “Now that we’re transitioning to high deductible plans, there’s more attention given to costs. Folks want to better understand.”

She added that patients are also becoming more savvy consumers of health care services, shopping around and comparing quality via social media and among various quality measures related to different providers. In the past, patients tended to stick with one provider. Now that they bear more of the cost, they want to look around.

More options, such as independent surgery centers, concierge medicine, and integrated providers, have contributed to a health care culture of consumer choice. Price represents yet another factor. On the other hand, healthcare facilities may utilize a Third-Party Revenue Recovery Management for Hospitals to better manage their finances and insurance claims.

Prices listed by any medical facility should be considered estimates, as the length of a hospital stay and complications can change it. Like a service writer’s estimate at a car repair garage, the estimates listed online can change.

Patients can also call the health system for an estimate, as Rochester Regional employs a full-time person for estimation.

“We would be unable to post the exact amount for an appendectomy,” Imm said. “We can’t, because it’s proprietary information that ties to hospital rates and third party negotiations. That’s why we request patients call or reach out through the website to get a case-specific estimate. We cater to them specifically.

“The last thing we want to have happen is a patient make a decision thinking it will be too expensive.”

Like most providers, Rochester Regional offers a payment plan and works with patients to find any grants available to help with costs if needed.

John Gillespie, president of the Medical Society of the County of Erie, said that the costs posted may not be what providers have negotiated with insurance companies or the cost for Medicare, “but it’s a step in the right direction,” he said. “It will also raise awareness because previously, patients never had any idea.”

He hopes that eventually, people will realize that preventive care and screenings can help not only improve their health but prevent more expensive interventions later.

Gillespie doesn’t view transparency as a fix for the health care system, but as perhaps a catalyst for providers to keep their prices within range of others.

“If they charge $8,000 and everyone else provides the same care for $5,000, you’ll go to the one charging $5,000,” he said. “They have the incentive internally to be efficient and use just what’s needed.

“One would also expect that there will be more negotiation on the part of Medicare for prices. By law, they can’t negotiate with ‘Big Pharma.’ As this evolves, maybe they will do that because that would lower costs.”