Tens of thousands of employers who buy insurance coverage for their workers will get this more-complete pricing picture – and may not like what they see.
“What we’re learning from the hospital data is that insurers are really bad at negotiating,” said Gerard Anderson, a professor in the department of health policy at the Johns Hopkins Bloomberg, Baltimore, citing research that found that negotiated rates for hospital care can be higher than what the facilities accept from patients who are not using insurance and are paying cash.
That could add to the frustration that Ms. Mitchell and others say employers have with the current health insurance system. More might try to contract with providers directly, only using insurance companies for claims processing.
Other employers may bring their insurers back to the bargaining table.
“For the first time, an employer will be able to go to an insurance company and say: ‘You have not negotiated a good-enough deal, and we know that because we can see the same provider has negotiated a better deal with another company,’ ” said James Gelfand, president of the ERISA Industry Committee, a trade group of self-insured employers.
If that happens, he added, “patients will be able to save money.”
That’s not necessarily a given, however.
Because this kind of public release of pricing data hasn’t been tried widely in health care before, how it will affect future spending remains uncertain. If insurers are pushed back to the bargaining table or providers see where they stand relative to their peers, prices could drop. However, some providers could raise their prices if they see they are charging less than their peers.
“Downward pressure may not be a given,” said Kelley Schultz, vice president of commercial policy for AHIP, the industry’s trade lobby.
Ms. Baicker said that, even after the data is out, rates will continue to be heavily influenced by local conditions, such as the size of an insurer or employer – providers often give bigger discounts, for example, to the insurers or self-insured employers that can send them the most patients. The number of hospitals in a region also matters – if an area has only one, for instance, that usually means the facility can demand higher rates.
Another unknown: Will insurers meet the deadline and provide usable data?
Ms. Schultz, at AHIP, said the industry is well on the way, partly because the original deadline was extended by 6 months. She expects insurers to do better than the hospital industry. “We saw a lot of hospitals that just decided not to post files or make them difficult to find,” she said.
So far, more than 300 noncompliant hospitals received warning letters from the government. But they could face fines of $300 a day fines for failing to comply, which is less than what insurers potentially face, although the federal government has recently upped the ante to up to $5,500 a day for the largest facilities.
Even after the pricing data is public, “I don’t think things will change overnight,” said Mr. Leibach. “Patients are still going to make care decisions based on their doctors and referrals, a lot of reasons other than price.”
KHN (Kaiser Health News) is a national newsroom that produces in-depth journalism about health issues. Together with Policy Analysis and Polling, KHN is one of the three major operating programs at KFF (Kaiser Family Foundation). KFF is an endowed nonprofit organization providing information on health issues to the nation.