How to Maximize Your Data Quality While Aiming for Price Transparency

It’s almost impossible to overestimate interest in price transparency. People want to know how their healthcare prices are determined, and payers do, too. But getting that information has proven to be a challenge. Why? Partially because so much pricing data isn’t readable or usable.

What makes healthcare data so hard to define and use? Historically, finance, actuarial, and contracting teams haven’t gathered or shared enough key information about pricing at the micro level. Consequently, a payer has no ability to make adjustments by independent services or categories. Rather, it might commit to boosting its “total contract value” by a certain percentage. That’s not a winning solution because it sets an artificial floor that has zero bearing on individual services, procedures, or cases.

One way around this problem is through comprehensive price transparency, which can allow for better precision and control over where to make increases and decreases. We saw Arkansas Blue Cross and Blue Shield try this approach successfully. Its leaders were getting ready to raise rates in sync with CMS rate increases. However, they took time to dive deeply into their true position. They learned they weren’t positioned as strongly as they assumed within a specific hospital system. Accordingly, they decided to forgo an annual rate bump in exchange for having a much better pricing position that attracted positive attention.