What can you do to prepare for price transparency requirements? Find out from the folks who wrote the rule.
In October 2020, the Trump Administration released the Transparency in Coverage (TIC) Rule, which aims to provide greater price transparency in healthcare. The first of the requirements (providing publicly available machine-readable files) went into effect on July 1, 2022 and further requirements are going into effect on January 1, 2023 (learn about those here).
We recently hosted a webinar with Eric Hargan, former HHS Deputy Secretary, and Randy Pate, former CMS Deputy Administrator and Director, two of the individuals responsible for writing the rule. Amino’s own Chief Product Officer, Andrew Rosenthal, joined as well to help lead the discussion around TIC and what it means for health plans. Here’s what they want you to know, from their advice, to predictions, and how you can get prepared now.
Are these new regulations a burden, an opportunity, or both?
Randy Pate, former CMS Deputy Administrator and Director: It's definitely both. In terms of the effort to post price information and make real-time negotiated rates for thousands of procedures available in a standardized format to enable apples-to-apples comparisons, we recognized there would be significant implementation burdens on the industry. We tried to moderate those burdens in the rule by, for example, requiring publication of only the 500 most shoppable services in year one, providing for good faith compliance with the rule, and keeping the number of specifications to a minimum. Another reason we didn't want to be overly prescriptive in how the information was conveyed is that we didn't pretend to have all the answers about making price information understandable to patients.
Therein lies the opportunity--the goal of the rule was to provide a framework for the private sector to innovate, to create tools that consumers can actually use to shop for care and compare prices for the care they receive. The government can set the minimum standards for compliance, but the private sector must go beyond to deliver on the promise of price transparency to lower the cost of healthcare.
Eric Hargan, former HHS Deputy Secretary: I agree that it’s both. And while some stakeholders see a serious burden, it is important to realize that the lack of transparency has been a burden heretofore borne by the patients, their families and by those ultimately paying, such as employers. And it is an opportunity, as clearer prices will hopefully mean a better-functioning healthcare market, and that’s healthier for everyone.
Do you have any advice for self-insured employers tasked with achieving compliance?
Randy: Both self-insured employers and health insurers are on the hook to comply with this rule. But it goes deeper than that, because again, the rule really sets up a minimum framework for compliance. In drafting the rule, we fully expect the market to step up and innovate, going beyond mere compliance to make this newly available price information understandable and actionable for consumers. That entails a number of imperatives, including making sure this complex information is presented in an easily understandable format and, wherever possible, coupling price information with available information on the quality of care. In the end, this rule is about driving down costs while maintaining or improving quality of care. Self-insured employers have a big role to play in this effort by demanding a higher level of innovation and not settling for mere compliance.
Eric: I think employers should see this as a way to get a better handle on what they’re paying, and how. They’re in a good position to use the new information to throw a better light on what they’re paying for and have been all along.
What are your predictions for the future of price transparency?
Randy: Predictions are always difficult, but fundamentally I see price transparency in healthcare as something that is here to stay. Once you put the information out there, you can't put the genie back in the bottle. Consumers now have a right and expectation to have this data. I also predict states will provide the next wave of statutes and regulations pushing price transparency forward.
Eric: I agree the direction here is more information, not less. I believe price transparency, interoperability and now flexibilities in value-based initiatives will be a fruitful area of growth, taken together.
Andrew Rosenthal, Chief Product Officer, Amino: The TIC regulations are forcing the publication and sharing of pricing data that was previously locked up in the actuarial department and protected by NDAs. For those of us used to working with billions of healthcare claims, these data provide an unprecedented view into the dangers to the patient of going out of network, and the cost to the employer being in the wrong network. We anticipate that the increased visibility and scrutiny around pricing will accelerate the demand for and adoption of guidance solutions.
What can self-insured employers do now to prepare for further healthcare consumerism and value-based care?
Randy: The future of healthcare is moving in the same direction we've seen other consumer-facing sectors move in, such as the automotive and computer industries. People expect not only transparent information on things like price and quality, but they demand tools to help them navigate their buying decisions and to curate their experience based on their personal needs and preferences. Of course, moving this direction in healthcare is considered revolutionary and is likely to be painful at first, but the market players--including self-insured employers--who recognize this shift and cannot just follow but lead in this area will reap the benefits, not just in saving money but in attracting and retaining the best talent.
Andrew: Just listing prices alongside provider names is a recipe for failure — we know that plan members ignore the data, or even worse, shift their visits to the highest-cost providers. Smart employers will go beyond just meeting TIC requirements and use this as an opportunity to introduce quality ratings, leveraging engagement to drive members to the most appropriate providers.
Want to hear more of their conversation? Watch the full on-demand webinar here.
