Report Card on State Price Transparency Laws

Submitted by on Thursday, July 9, 2015 - 04:24

Newtown, CT – July 10, 2015

When we launched our national report card on Price Transparency, TIME released its landmark article by Steve Brill, and public opinion and consciousness shifted – Since then, while the scores of most States have made little progress, that, like many other things in the industry, is about to change. During the past two years a significant amount of legislation has been introduced in State Legislatures around the country. Many have failed at the first try, underscoring the entrenched and significant forces of the status quo beneficiaries. But others have succeeded, thus further debunking the myths that have passed as legal arguments to block price transparency. With every new legislative success, the false arguments are torn to shreds, as is the credibility of those who profess them. To arm State Legislators, this year's Price Transparency Report Card includes an Appendix that takes a close look at the most-often used arguments against releasing pricing information. We hope that it will be put to good use, and we also suggest that State Legislators look to their colleagues in New Mexico, Oregon, Connecticut and other states that have spent the past year battling and winning against the forces of price opacity. Beyond State-based activity, the private sector has also taken an important lead. Most health plans have adopted price estimators in order to better compete against third party solutions like CastLight or Change Healthcare. A few health plans have also banded to assemble their entire claims datasets into a new not-for-profit, the Health Care Cost Institute. While this latest effort is laudable, it cannot and should not be used by health plans as an excuse to fight against State-specific all-payer claims databases (APCDs), and some of the recent discourse coming out of HCCI is concerning.

What this means to you – APCDs are the backbone of price transparency efforts because they offer state and federal policy makers, as well as consumers, providers, and all payers, the ability to peer into the variability that exists, not simply within a class of payers (e.g. commercial health plans), but across payer class. In another Appendix to this year's Price Transparency Report Card, we illustrate what can be done when looking at claims data from Medicaid and commercial payers in a single state, and only APCDs can provide these types of insights. While submitting files to 50 separate APCDs might seem burdensome to health plans that operate in all 50 states, it's a relatively small price to pay for the depth of analyses that can be achieved in return for that submission. And that burden should be of no concern to State Legislators and regulators whose primary responsibility is to all the residents in their State. Without the insights offered by APCDs, it's unlikely that policy decisions on State Exchanges, Medicaid payment reform and even provider acquisitions would be made optimally. In fact, they're very likely to be wrong. It will of course take time for all States to get to where the leaders are today, but the speed with which many States have proceeded in two years gives us hope that in five years the majority of Americans will have free and unfettered access to prices of health care services. For the rest, nothing much will change until they decide to replace those they regularly elect to safeguard their interests and fail to do so. I'm proud that Connecticut and many others have taken our Report Card seriously and are well on their way to getting an A. Hopefully, all other states will follow suit.