Healthcare price transparency should benefit patients by enabling them to shop for and compare plannable healthcare services to find the best price for the best care. Less obvious though, are the benefits that self-insured employers, health plans, and health shares receive from price transparency. Let’s discuss why price transparency is good for everyone in healthcare.

Why price transparency is good for self-insured employers and TPAs that help them.

Expensive hospital prices get passed on to you and your employees. Or if you’re a TPA, it gets passed on to your clients. But with price transparency, especially the Hospital Price Transparency Rule, there will finally be competition among hospitals to drive down costs. With prices available, expensive hospitals will lose patients who are able to plan for their care and choose more affordable options. This reduction in price will have a direct, positive effect on your healthcare spending and your employees’ out-of-pocket spending. So in addition to your employees being able to shop and compare care, you’ll also see a reduction in overall healthcare costs. And who doesn’t want to save money? For TPAs, you can be the hero who helps employers realize these cost savings by directing them to products and services that make shopping with price transparency possible.

Why price transparency is good for health plans.

Members want to find the best care for them and their families. This often means comparing the options that are available to them and the majority expect their health plan to help. In fact, 57.5% of members, across all ages, believe it’s important for health plans to offer digital self-service features, such as an app to shop-and-compare medical care. Disappointment and frustration with a lack of transparency, digital tools, and benefits will lead to poor reviews and higher member churn for health plans. But, 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. This in turn will lead to higher member growth.

Why price transparency is good for health shares.

Every type of health plan wants its members to be healthy, but health shares definitely have an added urgency to keep members as healthy as possible. This isn’t easy though, especially with opaque healthcare pricing. One study found that:

• 51% of those surveyed have avoided medical care due to a lack of ability to pay.
• 78% have been afraid to go to the hospital because of cost.

Members avoiding care for fear of price has several negative consequences for health shares. It can:

• Prevent members from getting care early on that would avoid higher expenses later.
• Skew your estimated costs for care.
• Ultimately lead to unhealthy and frustrated members.

Price transparency solves all these issues by providing members with the cost information they need to make confident healthcare decisions. When your health share members know what to expect to pay when they receive care, they’ll be more likely to receive care as soon as there is an issue instead of waiting until it’s an emergency (which costs more than preventive care). This leads to a healthier community, lower cost curve, and happier members.

Final thoughts.

When you look at all the ways to use price transparency and the many benefits it provides to multiple parties, it makes you wonder why it’s taken so long for price transparency to catch on. One reason is many healthcare companies have a lot to lose by adhering to price transparency so they have done everything they can to keep pricing opaque. But thanks to consumer and industry demand for change and legislation, patients, self-insured employers, health plans, and health shares can all start reaping the benefits of price transparency.