The role of price transparency

The benefits and challenges of reference pricing [Special Report]

By Brian Eastwood

As noted, the huge variation in medical costs demonstrates a need for price transparency, particularly for services where there's often little variation in quality.

Price--and quality--transparency are therefore "critical" to reference pricing, says Thomas Meier, vice president of product development for the Chicago-based Health Care Services Corp.

"You can't ask people to shop and be held accountable for that choice without best-in-class solutions to help them make decisions."

For example, the HCSC Provider Finder site lets members view provider clinical quality and demographic data, determine out-of-pocket expenses and view educational videos, the company said in a statement.

Members who acted on a recommendation from Provider Finder saved an average of $900 per procedure, according to the statement.  

In addition, HCSC has employees who serve in what Meier described as a "health advocate" role to walk customers through their options and help them make care decisions.

In addition to its effect on reference pricing, price transparency can support engagement efforts related to consumer-driven health plans as well as high-deductible health plans, he says.

Both aim to put consumers in the driver's seat when it comes to choosing first the right coverage and then the right care, but neither can succeed if consumers don't know what care costs.

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