What is the state of transparency in healthcare currently?
The current state of transparency in healthcare is one that is continuously evolving. There are several pieces of legislation aimed at giving consumers better insight into healthcare purchases and costs. One particular piece is the Executive Order by President Donald Trump, which requires hospitals, providers, and insurance companies to disclose pricing structures for health services publicly.
Having access to this data does not mean that the transparency gap will be completely resolved. For example, there are 9,000 Current Procedural Terminology codes (CPT) that are used to bill for medical visits for the services that are rendered. Then we have to work with the medical provider and health insurance to figure out how the charged amount was determined. This is further complicated by the fact that there is no standard price for the amount charged for health services or the amount that the health insurance pays.
Healthcare, in its current structure, asks who pays rather than finding out what is being paid and why is it so high.
How does the lack of transparency affect employers?
Each year, employers combat rising healthcare costs that are inevitably linked to the growing chronic disease epidemic. They’re forced to implement ineffective strategies that fail to properly address the root cause of high expenses. Let’s take a high-level look at the impacts caused by the lack of transparency:
1) Makes it challenging to insert levers of control
Health plans are structured around lots of moving parts with a wide array of vendors and providers. They all help in different ways, such as case management, disease management, and pharmacy benefits. However, having all of them may not be entirely necessary because it depends on the composition of your workforce.
2) Creates a sole focus on cost
Addressing the bottom line can seem like a quick and efficient way to lower costs. However, this a short-term strategy because it overlooks the cause of the expenses. Helping the employees that have the high-cost prescriptions, medical visits, and issues are proven to drive hard dollar savings and soft benefits such as increased productivity.
What is being done to enable transparency for employers and employees?
Employers need a solution that gives them full control over their health expenses, rewards employees for their health and provides tools for avoiding the most common health risks in America.
Incorporating a sustainable health insurance product that revolutionizes the way healthcare is financed and consumed is now more critical than ever. It must contain costs and leverage technology with preventive health management to target chronic conditions, which are the cause of 75% of healthcare expenses. Most of all, it should maintain a high-level of engagement (ideally 96% or higher) through an outcome-based, deductible incentive program.
Real transparency takes into account the cost, quality, risks, and consequences in a way that allows employers to insert levers of control and evaluate the performance of their health plan.
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