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Price Transparency: A Chief Concern at SIIA’s Recent Kanas City Forum

By: David Ostrowsky

KANSAS CITY, MISSOURI – In the opening presentation of the SIIA Price Transparency Forum held at the Kanas City Marriott Downtown last month, SIIA’s Senior Vice President of Government Relations, Ryan Work, made a bold prediction: if healthcare costs remain on this decades-long rising trajectory it could lead to the demise of employer-based healthcare as we know it.  

Judging by the ensuing statistics presented, this was no hyperbole. Per the report delivered by Work and his co-presenter, Chris Condeluci, SIIA’s Washington Counsel, from 2016-2020, healthcare prices increased at double the rate of inflation—a trend that was only exacerbated by the COVID pandemic, as evidenced by the average premium for employer-provided family healthcare shooting up to $22,221 in 2021, which equates to one third of the current median American household income and represents a threefold increase from 2001. Indisputably, a primary culprit behind the exorbitant and, in many cases, wasteful healthcare spending is the opaque pricing practices employed by many providers—as well as the ambiguity and flaws inherent in the No Surprises Act (NSA) that was resultingly passed to safeguard patients from receiving surprise medical bills stemming from many emergency services, non-emergency services from out-of-network providers at in-network facilities, and services from out-of-network air ambulance service providers.

On some level, the NSA, which went into effect on January 1, 2022, has delivered intended results. Consider that in the act’s first nine months of existence, approximately nine million surprise bills were prevented. However, within this newly rolled-out surprise billing arbitration process, the sheer volume of disputes submitted has been downright overwhelming. As Work and Condeluci explained, going into 2022, it was originally estimated that there would be 17,000 out-of-network payment disputes submitted for the entire calendar year; however, between April 15 and September 30 of last year, that number would swell to 90,000, a disproportionate number of which (23,000) came from Texas and were often ruled ineligible for federal arbitration. Alas, the ineligibility issue did not just pertain to Texas: by Work and Condeluci’s estimation, there were 41,814 disputes challenged for eligibility from April-September 2022. During that six-month period, 23,107 disputes were closed, 15,895 (69%) of which were ultimately deemed ineligible.

Such statistical findings beg the question: why was there such an exorbitant number of claims ruled ineligible? For starters, many of these claims should have been subject to their respective states’ surprise billing laws—not the federal NSA. Secondly, there are some claims filed that are Medicare related. Additionally, and perhaps most significantly, there have been quite a few providers who are bypassing the initial processes in accordance with the NSA (i.e., the initial 30-business day payment process upon receipt of the claim, which precedes the open negotiation process, also spanning 30 business days) and going straight to the independent dispute resolution (IDR) process. Meanwhile, an ineligible claim can also result from the poor transmission of information into the portal, a dilemma that is only made worse by the absence of a provider’s contact information. (It’s also worth noting that literally 10 providers/provider vendors are filing 75 percent of arbitration claims, leaving those responsible to be inundated with an often unreasonable amount of administrative work.) In sum, if all parties are not following the guidelines of the NSA, there will be an untold number of claims found ineligible.

The other notable hindrance to consumers reaping the benefits of more transparent pricing is the unfortunate reality that many hospitals have simply flouted NSA regulations. At the SIIA Price Transparency Forum, it was noted that while partial hospital compliance increased considerably from 2021-2022, a whopping 85 percent of hospitals are still not complying with the federal requirements to publicly post prices for offered services. Perhaps even more disturbingly, as Condeluci and Work noted, HCA Healthcare, America’s largest for-profit hospital system, one that contains 188 hospitals, remains entirely noncompliant with the federal price transparency rules inherent in the NSA. Further, per Condeluci and Work’s report, of the 361 hospitals owned by HCA Healthcare and fellow industry titans, Ascension and CommonSpirit Health, merely two comply at this hour. Such utter disregard of a law brimming with far-reaching potential is surely a discouraging situation, but perhaps one that can be rectified going forward.

Clearly, there are quite a few roadblocks to there being comprehensive price transparency within the American healthcare system. And that’s without even getting into the often not-so-user-friendly data presented to healthcare consumers shopping around for procedures and services … certainly a topic for another day.