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18-03-2013 | Article

Most states get a failing grade for health market transparency

Abstract

Full report

medwireNews: A report card assessment of each state's level of health market transparency in how they provide price information to consumers found that there is a general dearth of disclosure and access.

The report, which was produced by the Catalyst for Payment Reform and the Health Care Incentives Improvement Institute, created a grading scale based on healthcare transparency legislation in each state.

The report gave 29 states an "F" due to highly inadequate transparency laws - seven of which did not have any whatsoever - while seven other states received a "D" and only two states received an "A."

"The US health care industry is, by and large, completely opaque," the report says. "As the number of consumers in high deductible/high co-insurance health insurance plans continues to grow, market opacity prevents consumer-patients from comparison shopping. And since fear of market loss is a significant concern for many providers, there has been a tendency to block attempts at greater transparency."

Level of transparency was based on whether price information is reported to the state, is available to an individual upon request, is provided in a publicly available report, and is available on a website.

The report noted that the dismal across-the-board scores stem in part from a contractual "gag clause" that payers and providers must abide by and that prevents them from divulging the real costs of services rendered during the management of a patient.

While quality data have been made more readily available of late due to initiatives coming from the public sector, according to the report, "the availability of easy to understand quality ratings on hospitals and physicians has been spotty, at best."

While many states have laws that require the public reporting of pricing and quality information pertaining to providers as well as payers, the level of transparency can vary widely according to state.

"This variation in state regulations (barring federal regulation) seems inevitable, and suggests a process for better understanding the strength of such legislation by state," the report concludes. "[U]ntil such time as all states have robust and comprehensive legislation that provides a right for individual consumer-patients to fully understand the price and quality of the services for a specific medical event, we cannot expect a functional market for health care services to be developed."

By Peter Sergo, medwireNews Reporter