By executive order, the Department of Health and Human Services has only a few weeks to design a plan that would enable consumers to see the negotiated costs of their health services. That won’t just reveal the insurance co-pays or the hospital chargemaster prices — it’ll show the allowables that represent the true price of healthcare in the real world.
We officially got the chills over that bit of news.
Transparent pricing — a major driver of consumer behavior — would put the country further along the path toward a Smart Health Market in which consumers actually know what they’re paying for and make decisions accordingly. That kind of buying power will inspire greater innovation and value in the market.
Until the regulations are sketched out, it’s anyone’s guess how far into the weeds the Department’s transparency plan will go and how long it will take to implement. But we believe organizations would need two years or more to assemble all that information and package it in a consumer-friendly format.
Room for improvement in customer experience
According to a recent survey of hospitals and health systems, 28% of providers said price transparency is a priority for their organizations. However, only 4% rated themselves as having high capabilities in price transparency. Rising expectations in recent years have widened the gap between what consumers want and what the system delivers, analysts said. (Kaufman Hall)
What’s interesting is how many survey respondents also ranked themselves fairly low in meeting a variety of other consumer needs, even though they agree the capabilities are among their priorities. The survey indexes consumer-focused capabilities on four tiers, with tier one representing best-in-class execution and tier four representing a lack of meaningful movement.
For example, when it comes to access, just 9% of hospitals and health systems rank on the top tier, based on their virtual- and facility-based access points. We know the growth opportunity today is not in the traditional brick-and-mortar hospital sites, but rather in more convenient neighborhood access and consumer-facing digital channels.
Any time prices are a negligible differentiator, a good customer experience will be the deciding factor for consumers shopping for care services.
Some 81% of respondents said improving the customer experience is a priority. Good. As we’ve said before, there’s plenty of room for refinement there (if not a complete renaissance!). Any time prices are a negligible differentiator, a good customer experience will be the deciding factor for consumers shopping for care services.
In the survey, 11% of providers rated themselves on tier one, 38% on tier two, 34% on tier three, and 17% on tier four for providing a good customer experience. The opportunities here lie in real-time communication between providers and patients such as appointment scheduling, updates on in-office wait times, patient feedback, and access to provider notes.
Overall, providers are paying attention to market needs and remain hard at work looking to catch up on an ambitious list of consumer demands. By evolving toward a service-oriented culture that meets consumer needs, organizations will gain market advantages.
Our Take: Knowing Americans pay nearly twice as much for healthcare services as other developed countries, rational pricing data, convenient access, and an improved customer experience will go a long way in aligning the system with ever-rising consumer expectations.