State employees of Montana are forcing consumerism in healthcare

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Embracing consumerism. Employers are doing it. So are states. It’s time for providers to take heed and treat patients like the consumers they truly are. Giving them the Amazon experience in healthcare by providing price transparency is a big start. When people shop on the Amazon app, they don’t get only estimates or a sign saying, “buy now and get a surprise bill later.”

Consumers of Amazon goods know exactly what their costs will be. And so it should be with healthcare. It shouldn’t be that hard to do. After all, the platform exists right now that would allow providers to do just that: HealthQRS. But we’ll get to that in a moment. First, let’s discuss how one woman helped an entire state to embrace price transparency and consumerism in healthcare.

The following account of Marilyn Bartlett is taken from an article GPB News published Oct. 2, 2018, entitled “A Tough Negotiator Proves Employers Can Bargain Down Health Care Prices.”[1]

Marilyn Bartlett was a 64-year-old grandmother who, almost single-handedly pulled Montana from the brink with a radical strategy to bail out the state’s floundering benefit plan for its 30,000 employees and their families. Bartlett knew her way around a health plan with 13 years of experience as controller for a Blue Cross Blue Shield plan and also as a CFO for a benefits administration company. She pitched a two-fold strategy to the state’s Department of Administration (that the department liked and hired her to manage) to:

  1. Tell the state’s hospitals what the plan would pay. Take it or leave it.
  2. Demand a full accounting from the company managing drug costs. If the company wouldn’t reveal any side deals it had with drugmakers, replace the company.

More than half of American workers are covered by self-funded plans and Montana’s state employees are no different. When Bartlett asked to see detailed information about how much the plan paid its payer for pricing terms, she was refused. The payer said that contracts with hospitals were secret.

Yet she was expected to pay anyway? Apparently so. After quite a bit of back and forth and not being able to gain access to true contract pricing, Bartlett decided to go rogue and set her own prices for the hospitals. As she delved deeper, Bartlett found that prices for the same procedure differed dramatically. For example, one hospital gave a 7% discount for a knee replacement on a charge of $25,000 that reduced the amount to $23,250. Another hospital, for the same procedure, gave a better discount at 10%, but its beginning price was $115,000 with the discount bringing the bill to $103,500. So, simply looking at the discount percentage didn’t reveal actual costs.

With so much price variation, Bartlett decided to use prices set by Medicare as the reference point, because its prices are public as well as adjusted due to location and other factors. Montana’s plan would pay hospitals a set percentage above the Medicare amount, a method knows as ‘reference-based pricing,’ making it impossible for the hospitals to arbitrarily raise their prices.

Literally forcing providers and drug companies to reveal pricing led this woman to turn Montana’s situation around. Mission accomplished, Bartlett left her position as administrator of the state employee health plan and now works for the office of the Montana insurance commissioner to take on pharmacy benefit managers.

Takeaways?

Price transparency is possible. And, as employers, including states, make a stand, it will become harder for providers and payers to keep prices secret. Providers may not want to play ball at this point, but the time is quickly coming when they will have to. In less than three months, January 1, 2019, CMS will force providers to show, at the very least, their chargemaster prices. CMS’ 2019 inpatient and long-term care hospital prospective payment system (IPPS/LTCH PPS) rule is requiring from providers:

  • Greater price transparency
  • Interoperability
  • Significant burden reduction
  • Publication via the Internet

Simply posting a PDF is not good enough. Providers will need to have information that can be accessed easily by consumers through an app. HealthQRS offers a solution that allows you to comply with each requirement of the CMS rule. We offer a platform where you can negotiate directly with employers and states, like the state of Montana, to ensure that you gain their business. Not only that, we make it easy on all counts.

In June 2018, RevCycleIntelligence published tips for providers to improve their price transparency.[2] We can help with each one:

  1. Prepare for Hospital Price Transparency

HealthQRS allows you to provide actual prices, not just estimates, in an easy-to-use smartphone app where people can stay in network, shop for services, schedule with you, and pay for those services right from the app. You can set business rules to allow for discounts based on early payments, charity, and whatever else you wish to structure.

  1. Consider a Bundled Pricing Strategy

Our solution allows you to bundle pricing. This helps avoid surprise billing, which, in turn, allows for more satisfied patients. It also ensures that more providers actually receive their money.

  1. Educate Staff on How to Discuss Prices and Patient Financial Responsibility

Our point-of-service solution has interactive, intuitive scripts that your scheduling department, registrars and front-office staff can use to discuss prices and patient responsibility. Discounts can be offered at scheduling and check-in, and staff members can instantly see actual patient responsibility, not just estimates.

  1. Implement Price Transparency Tools

Within a few weeks, we can have your entire system up and running with fully-implemented price transparency tools. Our solution integrates fully with your EHR and allows you to provide meaningful use numbers as well.

HealthQRS allows you to be compliant with the new CMS transparency rules beginning Jan. 1, 2019. Our platform is the perfect vertical application for integrated delivery networks and offers you the infrastructure to give your patients more than just price transparency. You can treat them like consumers and offer them a complete retail experience just like Amazon which will serve as a powerful marketing tool for your facilities. And we can fit easily within your budget, because we are a software-as-a-service (SaaS), so you have no capital investment, just a low monthly fee.

HealthQRS has over 15 years of experience developing healthcare retail experiences for people and our founders have over 50 combined years of e-commerce experience. We invite you to watch our user-friendly app video that you can use to win consumers. We also have a point-of-service solution video that may interest you. You can also check out our E-Commerce Medical Marketplace Flyer for more information. Why not contact us right now to schedule a personalized demo? Embrace consumerism today and get a head start on January 1.

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[1] Editor, “A Tough Negotiator Proves Employers Can Bargain Down Health Care Prices,” GPB News, Oct. 2, 2018, http://www.gpbnews.org/post/tough-negotiator-proves-employers-can-bargain-down-health-care-prices

[2] Jacqueline LaPointe, “4 Strategies for Providers to Improve Hospital Price Transparency,” RevCycleIntelligence, June 4, 2018, https://revcycleintelligence.com/news/4-strategies-for-providers-to-improve-hospital-price-transparency