How the NSA Affects Price Transparency in Healthcare

Posted by Brinna Hanson on August 31st, 2022
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Brinna Hanson
Brinna is a marketing professional and graduate of the University of Minnesota. Brinna joined Smart Data Solutions in 2019 to assist the marketing department reach new heights with a focus on the HubSpot inbound process. From her time at Smart Data as well as at previous internships, Brinna has been able to gain knowledge in many different aspects of marketing as a whole.

Imagine a patient visits the doctor for allergies and leaves with a referral to an Ear, Nose, Throat (ENT) specialist for a follow-up appointment. In the typical U.S. healthcare system, the patient will follow the advice of their Primary Care Provider (PCP) and set up an appointment with the referred specialist. 

This is the usual process that most Patients, Payers, and Providers consider standard. However, as of July 1, 2022, the price transparency rule in the No Surprises Act (NSA) went into effect.

Under the price transparency rule, Providers are required to publicly list prices for their most common services. This requirement of price transparency in healthcare allows patients to compare costs between Providers both with and without insurance coverage.

Now when a patient receives the same referral to an ENT specialist, instead of taking their Provider’s recommendation at face value, the patient has the option to browse other healthcare Providers that offer the same type of specialist visit. In this scenario, the patient decides to go with an Out-of-Network ENT specialist because the cost of the visit at this Provider is less than it would cost to visit the specialist their Primary Care Provider referred.

This situation demonstrates the value of making price transparency widely available. Not only does this rule change the way patients approach selecting healthcare services, but it also changes the way Providers and Payers approach staying competitive in a cost-driven market.

The No Surprises Act Introduced Price Transparency in Healthcare

The No Surprises Act (NSA) was introduced in December 2020 with the goal of increasing transparency into medical billing, and reducing the financial burden healthcare has on consumers. This rule is broader than previous ones, and when it passed, it requested serious changes to healthcare administrative processing.

Diving Deeper Into Price Transparency

One of the major changes driven by the NSA was price transparency requirements. The NSA required hospitals to post prices for shoppable services by January 2021, and Payers were required to post negotiated prices with all Providers by July 2022.

Price transparency introduced the concept of “shoppable healthcare” or the ability for consumers to see the prices for common services, giving them the information needed to compare healthcare options and select a Provider that best suits their needs.

For Payers, price transparency has several effects on how they process healthcare information. Payers and Providers must figure out many unknown factors in how to share this data, such as how to account for differences in degrees of care based on the need. For example, an ultrasound for a routine prenatal check is different from an ultrasound to check a tumor. Payers should follow the lead of the Blues organizations to understand their approach and mimic it as appropriate.

Going forward, both Payers and Providers must offer these files in two formats:

The challenge lies in tactically making this happen. Healthcare administrative processing is complex. Many factors impact the cost of healthcare. Payers and Providers are responsible for simplifying this information in a way that helps patients make informed decisions.

Examining Price as a Factor When Patients Select Healthcare

Smart Data Solutions (SDS) welcomed Dr. Steve Parente to the 2022 Customer Symposium to speak about the changes that shoppable healthcare services will introduce. Dr. Parente has a background in health economics and focuses his work on how to feasibly ensure price transparency.

According to his presentation at the Symposium, price is one of the top concerns for consumers when finding healthcare Providers, especially given the high deductibles that are common today.

Of course, some exceptions exist. Specifically, quality of service is the most important factor for patients who are considering a major surgery or transplant. 

According to the National Library of Medicine, additional factors that individuals consider when selecting healthcare services include: 

Price transparency for healthcare services is such a new update that consumers are often unaware of their option to shop around when selecting healthcare — or they are unsure where to begin. 

“Many [people] feel that they have insurance and that’s that,” said Dr. Parente.

Shopping for Healthcare Has a High Potential for Cost Savings

How the NSA Affects Price Transparency in Healthcare 1

In reality, consumers will learn that when they start browsing healthcare Providers for competitive prices, the cost varies widely by service, region, and type of facility, such as a nonprofit hospital versus a for-profit one. Price transparency in healthcare has the potential to save consumers significant costs: 

Price transparency created the ability for consumers to select healthcare services based on the cost, and it has the potential to fundamentally disrupt how individuals navigate the healthcare industry. In this new environment, Payers and Providers have more incentive to ensure prices remain competitive and patients select their facility over another.

Enhance Internal Administrative Processes for Price Transparency in Healthcare

Shoppable healthcare is by far one of the biggest changes brought on by the No Surprises Act. These changes have affected how Payers, Providers, and Patients approach their healthcare choices. As the rules within the NSA continue to take effect, everyone will need to continue iterating on their processes to comply with new regulations.

Smart Data Solutions specializes in optimizing administrative healthcare processes by using technology to create greater efficiencies. Our 80+ in-house technologists bring the experience necessary to enhance legacy workflows and continually find areas for incremental improvement. Contact Smart Data Solutions today to continue advancing your system under the new NSA rules.

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