Price transparency in healthcare has many benefits. One of the main benefits is reduced prices and healthcare savings. Some argue that health price transparency won’t reduce healthcare costs, but others (us included) believe that the creation of competition among hospitals and other providers will lead to a reduction in prices. But, let’s say that price transparency doesn’t lower actual prices. 

Being able to see the actual cost of care still brings cost savings to patients, health plans of all kinds, alternative health plans, health shares, and employers. How? Glad you asked.‍

Price transparency allows patients to shop for care, which means lower costs for them and their payers.‍

When patients have a way to actually shop-and-compare plannable healthcare services, it means they’ll choose the most affordable option for their care needs. Especially if their payer also makes it easy for them to shop. Whether you’re a limited benefit medical plan or a health share, there are simple ways to incorporate healthcare shopping into your benefits. Whether a payer operates on an in-network model or not, they’ll see a reduction in overall costs when their members choose high-quality, low-cost care. ‍

Price transparency, presented as a benefit, improves member retention.‍

Did you know that 57.5% of members, across all ages, believe it’s important for health plans to offer digital self-service features? And that 58% of those surveyed said they wanted clarity around how much their healthcare will cost? Payers can fulfill both these needs by offering an app to shop-and-compare medical care. This will improve your member retention, which in turn leads to huge cost savings. After all, it costs far less (five times less, to be exact) to retain a member than to acquire a new one. Offering self-service digital tools that use price transparency to make healthcare easier for members will lead to lower costs and higher member satisfaction. Plus, you'll stand out from competitors by offering a healthcare shopping app based on price transparency.‍

The ability to shop for care can reduce the amount of large medical bill claims.‍

When members know the cost of care, they’ll be more likely to actually receive care. One study found that 78% of those surveyed have been afraid to go to the hospital because of cost. This avoidance often leads to complications in health, resulting in larger and more expensive procedures. If patients are able to know the cost of care, the odds of them receiving less expensive and less invasive preventive care increases. Which means lower costs for them and payers. Plus, when payers make it easy for their members to shop for care, it reduces some of the administrative work for the claims departments of these payers.‍

Final thoughts.‍

The ability to see healthcare pricing has benefits for everybody. Members shopping for care is especially beneficial to:

• High deductible health plans.
• Health shares.
• Reference-based pricing plans.
• Discount medical plans.
• Limited benefit medical plans.
• Critical illness plans.
• Final expense plans.

But, every type of health plan can enjoy this type of member engagement. After all, lower medical bills lead to lower claims costs. When members are aware of pricing upfront and prepared to pay the agreed amount, costs will be cut in back-end areas such as patient billing and collections. Plus, when payers of any kind offer price transparency as a benefit, it can improve member retention and therefore reduce member acquisition costs. Finally, price transparency will create competition among providers and lower healthcare prices.