Price Transparency in the ASC industry: Where are we now?

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If you asked most providers five years ago, it wasn’t immediately apparent that price transparency would be so important today. Ask someone today, and it's clear transparency is the next important innovation in healthcare finance. Once an oddity in the payment world, price transparency is now finding traction with consumers and providers alike.

But why is this the case? Recent legislative changes have readjusted incentives so that price transparency is beginning to look more attractive for all stakeholders. The Patient Protection and Affordable Care Act has made healthcare savings important to providers at the same time consumers are facing higher deductibles for their care. As a result, patients are beginning to tune in to the price tag that comes along with their medical care, and many have come to the conclusion that not all providers are the same where cost is concerned.

Richmond, Va.-based MEDARVA Stony Point Surgery Center is an ASC ahead of most in terms of price transparency. Having heard about the work with price transparency that Oklahoma City-based Surgery Center of Oklahoma is doing, the freestanding ASC decided to differentiate themselves in their market by becoming price transparent.

But, it wasn’t easy. “We started looking around, and people didn’t want to talk about what it cost,” said Bruce Kupper, CEO of the surgery center. “Then we discovered patients and employers don’t understand how we as healthcare providers get paid.”

The breakthrough came when Mr. Kupper was doing work for his employees’ insurance on the Anthem-Blue Cross website. When he discovered pricing for area healthcare providers, including his ASC, was available on the website, and MEDARVA was the lowest-cost provider in almost all cases, he decided it was a story the center needed to tell.

The center has since produced what Mr. Kupper calls a "facebook" page, an information sheet with provider information on the front and cash prices for procedures on the back. During a meeting with Anthem, the representative took a few of these sheets back with him to show his company. “The feedback from the carriers is that we’re on the right track and we’re ahead by promoting pricing,” says Mr. Kupper. In addition to the printed handout, the surgery center has also created an online site that allows patients to search for procedures and prices while learning more about price transparency and ASCs in the news.

And, ASCs have things easier than hospitals when it comes to becoming price transparent. Explaining overhead and how costs get calculated at hospitals can be difficult, but with the leaner structure of the ASC, it’s much easier to explain to patients where their money goes.

Even outside parties can do it, which is where FAIR Health comes in.

FAIR Health is a nonprofit whose mission is to provide transparency with respect to healthcare pricing and insurance information.. Robin Gelburd, president of the company, says the emergence of narrow networks and high deductible health plans in conjunction with a challenging economic climate means patients have to make choices about the kind of care they access. "Narrow networks may present challenges to accessing certain services. Patients might also choose to go out-of-network, in which case they'd need transparent information about the cost of particular services," she says.

Over the five years FAIR Health has been offering cost transparency information, Ms. Gelburd says she has noticed consumers becoming bolder in seeking out information, while providers are offering more openness. But, with the growing reliance upon ASCs, more information regarding pricing for these services would benefit all stakeholders. "We have felt for some time now that given the growing popularity of ASC venues for clinical services, there should be a concomitant increase in transparency with those services,” says Ms. Gelburd.

This spring FAIR Health will be releasing a new ASC-specific module for price transparency, which will provide price data for ASC-based services based on geographic region. Ms. Gelburd hopes her company's new product will help ASCs to bring more transparency to their markets. After all, the move toward price transparency has been speeding up, she notes.

Ms. Gelburd has consulted on price transparency in the legislative arena, and one thing she believes will aid the movement: a homogenous vocabulary to talk about transparency. "Moving in the direction of creating a standardized language to help articulate healthcare costs will be a key driver of whether transparency initiatives can be meaningful and can create critical clarity for the consumer," she says.

For the individual center, according to Mr. Kupper, investing in price transparency is also a good-faith move. "Unfortunately, we get overshadowed [things like the] Joan Rivers incident. Sensational stories make it look like we’re cutting corners. The ASC industry needs to tell its story in a more honest, more noticeable way, because we really do provide excellent quality care at a good price," he says.

More articles on turnarounds:

10 habits of highly effective ASC healthcare providers

How much of physician income is tied to productivity? 7 statistics

Top compliance challenges: 3 ambulatory care organizations

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