Price transparency leads to lower claims costs, research finds
When consumers have access to pricing information before they obtain medical services, insurers' claims payments are lower, according to new research published in the Journal of the American Medical Association.
In determining whether price transparency initiatives can actually lower claims payments for three common medical services, the researchers analyzed claims for laboratory tests, advanced imaging services and clinician office visits.
The study found that price transparency data for advanced imaging services like MRIs led to the most dramatic difference in claims costs.
In an editorial accompanying the JAMA study, Uwe Reinhardt, a professor at Princeton University, said that one of the biggest obstacles to price transparency initiatives is that payer-provider contracts usually require both parties keep the negotiated prices confidential.
"Although it is possible to understand the quest for secrecy on prices from the commercial perspective of insurers and healthcare entities, that secrecy certainly interferes with creating the price- and quality-conscious consumer of healthcare services," Reinhardt said.
Meanwhile, insurers say they are working to provide even more price transparency for consumers. George Lenko, staff vice president of Client Solutions at WellPoint, said transparency helps members choose better care, helps consumers engage in their health and improves market competition, according to an America's Health Insurance Plans blog post.
"When providers are competing on cost, on quality, and on service it really improves the system for absolutely everybody," Lenko said at the U.S. Chamber of Commerce's 3rd Annual Health Care Summit.
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