Dec 9, 2013, 4:33 PM, Posted by Susan Dentzer
“We should all be concerned about the future, because we’ll have to spend the rest of our lives there, “Charles Kettering, the prolific 20th Century inventor, famously said.
On December 2-4, speakers at the Robert Wood Johnson Foundation-sponsored National Summit on Transparency in Health Care Cost, Prices and Quality offered ample reasons why all of us should work toward a more transparent health care future. Here are five.
- Transparency is an idea whose time has come—in large part because U.S. consumers are feeling so much pain from higher health costs. Health economists have long noted that U.S. health care prices are out of whack and that hospital chargemasters are nonsensical. Recent media coverage of these phenomena has captured widespread attention, perhaps because consumers are being hit so hard in the pocketbook. Since 2000, rising prices of hospital charges, professional services, drugs, devices and administrative costs, are responsible for 91 percent of the increases in health spending. Meanwhile, consumers’ out-of-pocket spending on health care, estimated at $329 billion this year, is projected to rise to $411 billion in 2020—a 25 percent increase. Almost three in five workers in small firms, and one in three workers in larger firms, are in a health plan with a deductible of at least $1,000 for single coverage, and in 2012, nearly one of five U.S. adults was contacted by a collection agency over unpaid medical bills.
It’s well established that much of this money is being spent on health care of questionable value. With so much of their money—and their well-being—now at stake, “People are going to impose transparency on the health care industry,” predicted Leah Binder, a conference participant who heads the Leapfrog Group.
- Consumers and patients deserve to know far more about the costs and quality of care, but unless the two are linked, the public may continue with its longstanding delusion that the more expensive the care, the better the quality. Francois de Brantes, executive director of the Health Care Incentives Improvement Institute, noted that this widespread consumer misapprehension constitutes a “perverse incentive” for providers to continue to raise prices. Meanwhile, evidence of poor quality abounds. Martin Makary, a Johns Hopkins University physician and author of Unaccountable: What Hospitals Won’t Tell You And How Transparency Can Revolutionize Health Care, reminded the conference that preventable adverse events in hospitals are now the nation’s third leading cause of death annually. Many highly esteemed medical centers that end up routinely on “best hospital” lists don’t make the Joint Commission’s tally of top performers on basic quality and safety measures.
Conference speakers agreed that there’s a pronounced need to combat these trends by developing more and better quality measures—especially those capturing care outcomes, and in particular, the outcomes that are most important to patients. Providers’ scores on these measures should then be funneled to purchasers and the public. “When consumers can really start to see that this hospital is better than this other hospital, or this doctor is better than that doctor, they will start to move,” said Bill Kramer, executive director for national health Policy at the Pacific Business Group on Health.
Promising prototypes of the platforms that could communicate such information include winners of the RWJF Hospital Price Transparency Challenge—for example, Consumer Reports’ Hospital Adviser: Hip & Knee, which combines hospital quality rankings with Medicare cost data to help consumers pinpoint high value institutions where they could obtain surgery.
- Fostering greater transparency will be a long process, but there could be relatively quick “wins.” Many contracts between health insurers and providers contain “gag clauses” that bar both parties from disclosing claims data or prices paid for care. The clauses appear to serve both parties’ interests—helping to protect health plans’ proprietary interests in the provider networks they’ve established, and providers’ desire not to disclose how little they are willing to be paid. California has outlawed such clauses in health plan contracts, and many conference attendees agreed that other states should follow suit.
Other approaches could also help to make health care markets more efficient. Rep. Michael Burgess (R-TX) spoke about his proposed legislation HR 1326, the Health Care Price Transparency Promotion Act of 2031, which would require state Medicaid plans to make hospital charges public and provide individuals with estimated out-of-pocket costs for health care services. He described the bill, which has been backed by the American Hospital Association, as “a modest attempt to set parameters that states can follow” in making their health care systems more transparent. Still other conference participants pointed to legislation introduced by Senators Ron Wyden (D-OR) and Charles Grassley (R-IA), the Medicare Data Access for Transparency and Accountability Act (S.1180), which would create a public, searchable database of all Medicare claims and payment made to any service provider or supplier.
What’s more, a total of 16 states have set up mandatory or voluntary all-payer claims data bases (APCDs) to pool statewide data on diagnoses, procedures, care locations, and provider payments. Conference participants agreed that more states should enact mandatory APCD’s, or use the regulatory authority in state insurance laws to compel insurers to issue payment and pricing data, as was done in Rhode Island. More states could also follow the lead of Maine Quality Counts, the private, independent nonprofit organization that leads the RWJF-sponsored Aligning Forces for Quality coalition in the state, and which has aggregated health plan data for purchasers, consumers and providers to promote transparency on quality and cost.
- Transparency in the hands of consumers could be powerful—but in the hands of providers, even more so. Health care providers themselves often lack information about the quality and costs of their care. In particular, transparency can focus attention on the extreme amount of variation among providers in the care they provide. Glenn Steele, president and CEO of Geisinger Health System, described how Geisinger’s physicians came together to define “best practices” across a dozen hospital episodes of care, including heart bypasses, hip replacements, and gastric bypass surgery. As physicians in the system adhered to these guidelines, spending fell, by 20 percent because doctors narrowed the indications for which they agreed that the procedures were warranted, and 15 percent by reducing unnecessary variation.
- Transparency is a necessary but insufficient tool for health system transformation. Openness about price and quality alone is “not going to be enough” to achieve the goals of the Triple Aim, observed Steven Brill, whose Time magazine article in March 2013 gave renewed focus to the issue. Payment reforms and “culture change” that shift providers from a volume-based to-value-based approaches remain critical. What’s more, consumers need to have health insurance benefit designs beyond high-deductible health plans that encourage them to make wise choices, such as “value-based” benefits” that help nudge them toward cost-effective care delivered by low-cost, high quality providers. Others at the conference warned that regulators must stay attuned to unintended consequences of health system transformation, such as the consolidation of health care providers that could lead to attempts to jack up prices.
In the end, “We don’t win the game until the care gets better,” observed Jay Want, CEO of WantHealthcare. The nation also must ensure “that the transparency we seek will serve to change the way we think about health and wellness,” said RWJF president and CEO Risa Lavizzo-Mourey. “We need to use our skills, our imagination, our influence, and, yes, our hearts, to transform our nation into one that considers being healthy part of what it means to be an American.”
To that end, transparency about the choices we face as a nation on the costs and quality of health and health care can give our society a critical lens to look within.