Jeff Leibach is Director with Navigant’s Healthcare Strategic Solutions team, supporting clients as they manage the financial and strategic challenges in today’s rapidly changing healthcare landscape. Jeff’s areas of expertise include managed care negotiations, pricing and reimbursement analytics, and aligning clinical and financial leadership as providers and payers weigh the transition from fee-for-service to value-based care. Jeff has led development of several of Navigant’s proprietary analytic models that create actionable insights from large claims data sets. Additionally, Jeff leads training programs for health care executives focused on managed care strategy, value-based care, and negotiations independently and in collaboration with the Kellogg School of Management.
Price transparency is the ability for patients, families, and providers to understand — without being a healthcare finance expert — the expected cost to the patient of a healthcare service before it is performed.
Price transparency addresses the inability of patients to easily shop for lower cost services between providers and appropriately weigh the financial implications of their care in their overall decision-making. Overall, this inability may cause patients to avoid healthcare services or to pay too much for a service available at other options.
Price transparency may be an accelerant to value-based care, but to date they have functioned largely independently. Value-based care can be delivered by reducing utilization or shifting sites of service to lower-cost sites without knowing the exact price or out-of-pocket cost of a service.
Only to the extent that providers and patients are fully aware of the services they need. Unpredictable and emergent care will never be transparent, but certainly there can be significant improvements in the space of drugs, planned medical and surgical services, and physician services.
Patients will benefit the most, followed closely by payers, who will benefit from patients selecting lower-cost providers and sites of care. Providers will benefit the least, as they will likely be pushed to reduce the prices on commoditized services. To date, managed care contracted rates between payers and providers have been largely confidential. If prices were to become fully transparent, these contracted rates would become public, and could potentially significantly disrupt payer/provider relationships and contractual rates in the short and long term.
Healthcare is routinely criticized for a lack of price transparency. This criticism seems to imply that price transparency would make healthcare better: better outcomes, lower prices, and overall better value. Is that true?
In the second of a two-part series, “Leading the Conversation: Does Price Transparency Matter?” will challenge this criticism and engage health leaders in uncovering the challenges to improving outcomes, lowering costs, and delivering value in a price-conscience world.