Steve Jobs Moment
One of the most frustrating things about my career in healthcare is the lack of prospective thinking. We are so entrenched in our history and what has worked in the past that we miss the mark, repeatedly. It is not that we are swinging and missing at the fat pitches down the center. We are simply being called out on strikes. Caught looking!
The Hospital Price Transparency Final rule went into effect January 1, 2021. Of course, this is decades after complaints over the complexity and absence of transparency around hospital pricing from many different constituents. This rule requires that hospitals display standard charges for at least 300 shoppable services, including 70 specific services provided by CMS. This must be prominently displayed on the website with plain language descriptions and the discounted cash price. There are more clarifications on the rule found in the federal register at 45 CFR 180.60.
Currently, CMS estimates that about 70% of hospitals are compliant with this rule. And the first fines for noncompliance have been issued. Georgia hospitals have been fined over $1 million. I would expect this to increase substantially soon. It will be easier than a downhill speed trap two miles from the local casino. Not that this has ever happened to me…
I truly wish we would do more than check the compliance box on this one. I would love it if we would put our patients first and ask what would Steve (Jobs) do? He would start with what would really help my customer? What would make my product essential to my customers? How can I go above and beyond what others are even contemplating?
So, I decided to see for myself how hospitals are doing implementing this rule. I picked six large health systems out of the blue. The only requirement for me was that financial resources would not be a constraint in achieving compliance. All of them are A-rated organizations from one or more of the big rating agencies. Only one of them had a prominent link on the home page clearly labeled as price estimator. One other had a fine print link at the bottom of the home page. The others required patience and solid detective skills. By my calculation we have already blown the 70% compliance estimate from CMS. One of the six displayed one of those “Under Construction” labels when the link was selected. I don’t think this is acceptable to CMS.
What about the use of plain language? I looked at three very common procedures for the remaining five hospitals including diagnostic colonoscopy, major joint replacement, and normal vaginal delivery. Here are the different descriptions each used to describe the same procedure.
1. Routine Obstetrical Care
2. Vaginal Delivery
3. Full Rout Obste Care, Vaginal Deliv. (My favorite)
4. Routine Vaginal Delivery
5. OB Vaginal Delivery w/o sterilization (Yikes, who said anything about that!)
Houston, we have a problem.
Each website organizes its shoppable services into categories. These categories and their descriptions are not standardized. And the procedures contained therein are not the same. I had to hunt for colonoscopy. It was never in the same place twice. I would be shocked if there were that much variability in their high volume/most common services.
OK, let’s talk about the discounted cash price. There was about 200% variation from the low to high quote on charges. The discounts offered ranged from 0% to 51%. None of the hospitals suggested additional financial assistance is available based on eligibility (insert link to criteria). One included physician fees, three excluded it and one other was a hybrid (extra confusion). They were across the board in the use of disclaimers. Mostly, they just increased confusion or generated more questions than were answered.
This is a tool that could be so much more user friendly, easy to find, easy to understand, and it could be something that increases loyalty, satisfaction, dare I say community pride in the local hospital. Not to mention it would save time for consumers and hospitals both in decreasing the number of calls to hospitals for pricing information. I wonder what the government will legislate next when it realizes this did not help consumers.
What has been your experience with pricing transparency?
