In March 2018, a bipartisan group of U.S. Senators invited feedback on a new initiative to improve health care price and information transparency. NYSHealth submitted the following comments based on the Foundation’s efforts to empower health care consumers, make the health care system more transparent, and arm consumers with information on price and quality:

March 23, 2018

Dear Senators Cassidy, Grassley, Young, Bennet, Carper, and McCaskill:

On behalf of the New York State Health Foundation (NYSHealth), I am writing to provide requested feedback on your bipartisan effort to improve price and information transparency. NYSHealth believes that achieving greater health care price and information transparency is a gateway to high-value care that can result in better health outcomes and patient experience for all Americans, while helping to rein in escalating costs in the system. Our program on Empowering Health Care Consumers shares your goals: to make the health care system more transparent and to arm consumers with information on price and quality to facilitate informed decision-making and engagement in one’s own care. We wholeheartedly applaud your proactive efforts to do the same for the country as a whole.

As you commence your important work, we suggest the following themes:

  • The full potential of transparency tools remains largely untapped and many tools do not match the type of price information and quality measures that matter to patients and that they are seeking.
  • Consumers both want and need price information. Information on price must reflect the “real price” that consumers will pay and be available in a way that enables consumers to comparison-shop and make informed choices.
  • States are well-positioned to be leaders in transparency efforts, particularly through the development of All-Payer Claims Databases (APCDs) for consumer transparency purposes. Congress can reinforce states’ legal authority to collect and publicly report health care claims data and appropriate funding for APCDs.
  • There is much the federal government can also do to enable states to leverage existing data and tools to enhance transparency for consumers, such as removing gag clauses and trade secret restrictions and instituting mandatory reporting.
  • Although it is important to consider additional burdens on providers, payers, and other industry stakeholders in these transparency efforts, the priority is to minimize burdens on Americans.

In response to some of your questions, you will find below detailed responses that draw on lessons learned from the work of NYSHealth and our grantees, as well as recommendations for how to best move forward.


Question: What information is not currently available, but should be made available to empower consumers, reduce costs, increase quality, and improve the system?
 

Need for Consumer-Centric Information: While considerable information and resources already exist, they often are not responsive to what consumers want and need. For example, there is a lack of information on quality measures that matter to consumers. A recent study by the United Hospital Fund (UHF) found that of the 462 existing publicly-reported quality measures, few are relevant to what consumers are looking for in making health care decisions.[1]

The types of information that consumers want include:

Condition- and Episodic-Specific Information, such as 5-year survival rates by stage for prostate cancer. Most transparency tools lack condition- and episode-specific information, especially when it comes to prices. It is much more meaningful for consumers to see the “all-in” price for a health care event or episode than to see only the hospital portion or the portion associated with an isolated procedure related to the episode. The federal government has invested considerably in the development of episode groupers, as well as new payment and delivery models geared toward specific episodes and conditions. Sharing this information with consumers as part of transparency tools would be able an enormous step forward in providing consumers with the information they want and need.

Clinician-Level Information, such as reputation, expertise, credentials, and history of legal action, are either non-existent or hard to find in most transparency tools. Some of this information is not well tracked, such as hospital affiliation or information on malpractice claim results. When the information is tracked, it is often difficult to link it with information in other databases for the same providers related to price and quality. For example, the federal database on payments that individual physicians receive from drug and device manufactures does not contain provider identification numbers that are linkable to claims data. The federal government should develop and streamline standards that allow the linkages across datasets, particularly for its own data.

Patient Experience and Patient-Reported Outcomes. Patients value the experiences of other patients. Therefore, greater emphasis is needed for measures such as provider communication skills, respect, compassion, ratings by patients in similar circumstances, and quality of life. The federal government already supports patient satisfaction and experience surveys such as the Hospital Consumer Assessment of Healthcare Providers and Systems (HCAHPS). Considerations should be given to expand and deploy such efforts on a larger scale and in more settings. Patient experience measures coupled with patient reviews or narratives from sources like Yelp have also been found to be a promising source of information, but are rarely reported in a systematic way.[2]

Timely information. The information provided is often years old, limiting its pertinence to consumer decisions being made about future care. The federal government should amplify efforts to have more recent data used for its quality reporting initiatives (e.g., Hospital Compare), which are often the inputs used for quality transparency tools. Also, it will be critical that states and other third-party developers of transparency tools have access to timely administrative and claims data from federal health care programs, such as Medicare (including Medicare Advantage), to support transparency efforts such as APCDs.

Accurate and Usable Prices. There are consumer transparency websites available (such as one developed by FAIR Health with NYSHealth funding, called YouCanPlanforThis.org) that enable consumers to estimate in-network costs and out-of-network costs for thousands of medical procedures in their geographic areas, and also to compare costs by provider for some common procedures. Other tools exist that report prices for the highest-volume procedures or episodes of care; these can allow consumers to more fully assess the total cost of care associated with health care events.

These tools represent the current state of the art but there is room for further improvement. Some provide “charges” but do not offer “true price” information that reflects the actual prices paid. This is in part a result of efforts to create trade secret protection for health care information. Congress should ensure that the negotiated prices between insurers and providers are available for transparency work.

Similarly, a limitation of many price transparency tools is that the prices presented are the aggregated prices across multiple payers and/or providers. These tools do not provide access to information regarding an individual’s specific health insurance coverage benefit design structures, including relevant co-pay and deductible information. Individual health plans sometimes make this information available, but only to already-enrolled consumers. Without the critical overlay of an individual’s own insurance benefits, currently available price information can’t be fully informative for consumers. Congress should lead the way in this effort, particularly for federally managed health care plans.

Information on Drug Prices. Escalating drug prices are contributing to a more costly health care system, and consumers are feeling the pain in their wallets. Various efforts are underway to address this issue. New York State and Maryland enacted laws that use a variety of legal levers to impose financial penalties or require discounts if prices are too high. California recently enacted a law that will force drug manufacturers to provide advance notice of price hikes and to publicly justify big price hikes. The Pharmaceutical Research and Manufactures of America believes that transparency efforts need to address the large rebates and discounts that insurance companies and pharmacy benefit managers are receiving, which are not always being passed on to patients, and which pharmacists are often forbidden to discuss with consumers.[3] It is notable that a bipartisan group of Senators recently introduced a bill to ban pharmacist “gag clauses” that can inhibit the discussion of potential savings with consumers when they fill their prescriptions.


What role should all-payer claims databases (APCDs) play in increasing price and quality transparency? What barriers currently exist to utilizing these tools?

APCDs should play a central role in transparency efforts. Drawing from the single-repository, public utility model, APCDs are a fundamental step to health care transparency and could be highly valuable for consumers. Although most APCDs may not currently be able to provide consumers with their exact out-of-pocket estimates that reflect their deductibles and other costs, they have the potential to provide approximate enough pricing information to facilitate decision-making.

A consumer’s health plan may be better positioned to provide consumers with their exact out-of-pocket liabilities. However, health plan cost estimator tools also have major limitations and vary in their usefulness.[4] In addition, some health plan cost transparency tools are hobbled by gag clauses in provider contracts that do not allow them to include that provider’s or hospital’s information. Moreover, APCDs support comparison-shopping beyond what would be available within a health plan’s network. This would allow for consumers to understand the value of providers across health plans and how their providers compare against relevant benchmark standards, which is helpful for individual consumers as well as employers and other health care purchasers.[5]

APCDs can also support patient education on the variation of prices and quality. An NYSHealth- and Robert Wood Johnson Foundation-funded survey by Public Agenda found that more than half of New Yorkers are not aware that some doctors and hospitals charge more than others for the same service.[6] It should also be noted that some states, such as New Hampshire, are also moving toward overlaying the specific health plan information on cost-sharing, which will make their APCD tools even more useful to consumers.

To maximize their utility, the federal government should reinforce the authority of states to collect data needed for APCDs from commercial insurers and third-party administrators operating in their states. This includes plans offered by organizations considered employers under Employee Retirement Income Security Act (ERISA). In most states, including New York, 30% to 50% of the commercially insured population is covered by self-funded ERISA benefit plan arrangements. Data from ERISA-subject plans are no longer subject to mandatory reporting to state APCDs under the Supreme Court Gobeille decision, hobbling the breadth of data for transparency. There is an opportunity for Congress to address this by instituting mandatory reporting. For APCDs to be truly all-payer databases and be available to assist all Americans, data from these plans must be included.

A lack of funding for APCDs can also be a barrier. Federal funding support can help states feel secure that they can implement and sustain APCDs over the long term.

 

Who should be responsible for providing pricing information and who should share the information with consumers?

States should play a key role in information-sharing. Undoubtedly, all stakeholders need to play a role in ensuring that meaningful price and quality information is available for consumers. Effective transparency is much more likely to be achieved if payers, providers, and other stakeholders are working as partners in this effort.

States are particularly well situated to be leaders in facilitating this effort. In fact, according to a nationally representative survey conducted by Public Agenda, 80% of Americans believe it is important for their state governments to provide people with information that allows them to compare prices before getting care.[7] Research shows that health care consumers are skeptical of indicators that come from a source that has a financial or other interest in providing the information, and may view it as an advertising pitch instead of impartial education.[8] States are less likely to be tainted by these conflicts, whether real or only perceived.

In addition to their impartiality, states are well positioned to operationalize an APCD. States have relevant legal authority over a substantial portion of commercial insurance plans operating in their states and Medicaid. They can also raise and make available the resources through state, federal, or even other public or private philanthropic sources to manage the collection of the data, as well as the processes needed to ensure the credibility of the information provided. Some of these efforts can build on resources states already manage for other purposes that use similar data. There are also efficiencies associated with states managing an APCD, as they can use this information for various research, analytic, and monitoring tasks that can inform their other administrative responsibilities and policy considerations, aside from developing consumer-facing transparency tools.

 

How do we ensure that in making information available we do not place unnecessary or additional burdens on health care stakeholders? 

Consumers are the ultimate stakeholders. When considering the burdens on the various stakeholders, consumer should be considered the ultimate stakeholders. Rising health care costs put an ever-increasing burden on all Americans. The health care market increasingly moves toward “consumer-directed” plans, such as high-deductible health plans, without arming consumers with the information necessary to select providers they can afford or providers with good outcomes.

As your committee moves forward with transparency efforts, it is essential to have patient and consumer advocates directly at the table as equal partners. We have advocated for this in New York as the state moves forward with developing its APCD initiative. This representation will provide vital feedback on ways to develop and tailor tools and resources to be responsive to consumer needs and also help ensure that there is not undue burden placed on consumers in accessing and using these resources.

Thank you for the opportunity to provide input on this important matter. As we move forward in our efforts in New York State, we look forward to additional opportunities to share what we have learned and to contribute to the national discourse. Your leadership will make a difference in the health and lives of Americans.

Respectfully submitted,

David Sandman, Ph.D.
President and CEO
New York State Health Foundation

[1] Rogut, L., Kothari, P., Audet, AJ. 2017. Empowering New Yorkers with Quality Measures that Matter to Them. Available as of March 16, 2018 at:  https://nyshealthfoundation.org/wp-content/uploads/2017/12/empowering-new-yorkers-with-quality-measures-dec-2017.pdf.

[2] Howard, P. and Feyman, Y. 2017. Yelp for Health: Using the Wisdom of Crowds to Find High-Quality Hospitals. Available as of March 16, 2018 at: https://www.manhattan-institute.org/html/yelp-health-using-wisdom-crowds-find-high-quality-hospitals-10186.html.

[3] Dembosky, A. October 9, 2017. New Law Challenges ‘Evils’ of Pharma Profits, California Governor Claims. Kaiser Health News. Available as of March 16, 2018 at: https://khn.org/news/new-law-challenges-evils-of-pharma-profits-california-governor-claims/

[4] Consumer Reports. 2016. Consumer-Facing Healthcare Cost and Quality Tools. Available as of March 16, 2018 at: https://www.consumerreports.org/content/dam/cro/news_articles/health/PDFs/CR_Issue_Brief_Consumer_Facing_Healthcare_Cost_Quality_Tools_Nov_2016.pdf.

[5] Miller, P., Peters, A., Porter, J., and Sullivan, E. 2015. New York’s All-Payer Database: A New Lens for Consumer Transparency. Available as of March 16, 2018 at: https://nyshealthfoundation.org/wp-content/uploads/2017/12/new-york-all-payer-database-a-new-lens-for-consumer-transparency-sept-2015.pdf

[6] Schleifer, D., Silliman, R., and Rinehart, C. 2017. How People in New York State Use Health Care Price Information. Available as of March 16, 2018 at: https://nyshealthfoundation.org/wp-content/uploads/2017/11/how-people-in-new-york-state-use-health-care-price-information-brief.pdf.

[7] Schleifer, D., Silliman, R., and Rinehart, C. 2017. How People in New York State Use Health Care Price Information. Available as of March 16, 2018 at: https://nyshealthfoundation.org/wp-content/uploads/2017/11/how-people-in-new-york-state-use-health-care-price-information-brief.pdf.

[8]De Brantes, F., Delbanco, S., Butto, E., Patino-Mazmanian, K., and Tessitore, L. 2017. Price Tansprancey & Physcian Quality Report Card 2017. Available as of March 16, 2018 at: https://www.catalyze.org/wp-content/uploads/2017/11/Price-Transparency-and-Physician-Quality-Report-Card-2017_0-1.pdf.

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