By Rosana Garcia
This is the third in a series about SB-811, a landmark health care bill that passed in the Connecticut General Assembly this year, now known as Public Act 15-146, An Act Concerning Hospitals, Insurers And Health Care Consumers. In this series, we will examine the different elements in the larger bill, as it collected a wide range of new laws and changes to current laws. Today, we discuss efforts at transparency.
Cost transparency in health care was one of the issues addressed in Connecticut’s new health care law passed last year. What does this even mean?
When discussing cost transparency within health care, what people are really talking about is knowing how much a patient will have to pay out of pocket. This can be complicated, because different insurers and insurance plans pay different rates to providers (for the same procedure).
The CT Mirror examined the new statutes in “How well will new rules on health care cost transparency work?” The most timely changes are those that went into effect just as we rang in the new year, though there are other changes coming down the pike later in the year (so keep your eyes peeled for our posts on that). The transparency requirements that are effective as of January 1, 2016:
- Health care providers, before any scheduled non-emergency admission, procedure, or service, must determine if the patient is insured, and if not, what their costs will be
- It is now prohibited for contracts between providers and carriers to restrict the disclosure of billed or allowed amounts, reimbursement rates, or out-of-pocket costs, or any other information required by the All-Payers Claim Database (APCD)
- Insurance carriers must provide consumers information when they are enrolling in a health plan, in a format that is easy to understand, that includes coverage exclusions, restrictions in coverage, and the costs of prescription medications
- Bills that include facility fees must now disclose, among other information, the fact that the patient may have saved money at another facility (not associated with the health system) and that they can request a reduction of the fee
- If a provider practice is being purchased by a health system and will begin charging facility fees, the provider must notify patients of this change
This is a lot of information. The main purpose of the information is to help consumers make decisions about where they will receive care, armed with cost information, in the hopes of reducing cost. But, as Levin Becker points out in her article, a study of similar measures in Massachusetts was not promising, in the sense that it was hard for consumers to get the cost information they need, as providers had yet to implement systems to easily answer these questions.
The study authors pointed out that “passing transparency legislation is one thing. Embracing a culture of transparency and eliminating the secrecy that surrounds healthcare prices is quite another.”
While the Massachusetts study focused on the provider’s ability to disclose cost information, what is the consumer experience in “shopping” for care?
Sarah Kliff from Vox wrote “I thought people should shop more for health care. Then I actually tried it.” She points out how going for the lower-cost MRI actually compromised the quality of her health care experience in the long-run. “The lower-cost procedure — in this case, an MRI — did indeed save my insurance plan money. But it created a worse medical experience for me, and was helpful in highlighting the trade-offs that patients must make in the shopping experience.”
Kliff’s article brings into sharp relief the difference between cost and quality in health care. While it may be useful to “shop” for certain aspects of care, the consumer often has to make a decision without any information regarding the quality of care. Lower quality services, despite their potentially lower cost, may end up costing more in the long run.
On the other hand, how can we, as a state, begin to chip away at the problem of rising health care costs, without this type of information? How else will consumers begin to take control of their health care costs? Until more transparency provisions come into effect in the coming year, we won’t be able to determine the efficacy of the statutes.
But it’s a good start. And we’ll be watching.
Understanding Connecticut’s New Health Care Law
Our prior coverage of Public Act 15-146 (SB 811):
Rather read a summary? Here is the Summary of Public Act 15-146
Cheat sheet: What’s in the new health care bill (CT Mirror, June 1, 2015)