When most people think about how much they’ll pay in medical bills during a given year, the answer they come up with is usually somewhere between “a lot” and “I have no idea.” That’s because only 36 percent of patients ask how much a medical service will cost before getting it, according to Anthem’s Trends in Health Benefits 2018 report. Even when patients do ask their doctors what they can expect to pay for a procedure or other service, they don’t always get a definitive answer.
Enter price transparency in health care. Through pricing tools offered by insurance companies and hospitals as well as detailed estimates from health care businesses, your employees can get more information about their care upfront. But even the best pricing tools won’t be effective if patients aren’t aware they exist or don’t know how to use them. Sharing a little information with your employees about their options for finding affordable care can empower them to make cost-saving decisions and plan ahead when choosing their benefits or making decisions about health savings allocations.
How Do Price Transparency Tools Work?
These online tools estimate what a given service might cost and compare what different providers charge for it. One survey found that 77 percent of employers offer a cost transparency tool. Not all tools are created equal, though. Some don’t show the right information, while others aren’t tailored to your insurance company’s contracted rate.
When encouraging your employees to use these tools, guide them to look for ones that:
- Include the cost of service and your employees’ copay or deductible
- Include quality information and ratings for the physician or facility
- List prices for providers within an employee’s health plan network
- Account for a specific health plan’s contracted rate
- Are easy to use and mobile friendly
Even if a tool offers all this and more, though, employees should keep in mind that these tools only provide rough estimates. Employees may want to see if they can verify the accuracy of the results with their providers before receiving services.
How Do You Leverage a Price Transparency Tool?
Many people don’t check health care prices because they don’t think it makes a difference. Once someone has established a relationship with a provider, they’re not likely to change based on a lower price. In fact, about 60 percent of people say they would stay with their current provider even if they knew what their health care costs would look like ahead of time.
So how does checking out prices for medical services actually help your employees?
- Budgeting. If your employees annually elect to set aside money in a health savings or flexible spending account, knowing the costs of anticipated services can help them more accurately estimate how much to contribute.
- Comparing costs. For elective procedures, imaging and lab tests, comparing costs can save your employees money. Imaging costs vary widely across providers and facilities. Getting an MRI, for example, will generally cost less at a stand-alone imaging facility than at a hospital. If an employee is planning to receive care from someone other than their typical provider of choice, they have a great opportunity to shop around.
- Avoiding sticker shock.
Even if an employee knows they need a procedure and doesn’t have much choice in where they go to have it done, they can still get peace of mind from knowing what to expect before the bill comes. Taking advantage of price transparency in health care makes your workforce better prepared to absorb medical expenses and helps with managing health care costs.
Price transparency tools can’t factor in every health care consideration. Patients don’t just want the lowest price for their health care — they want the best value. Even if these tools are just one piece of the puzzle, though, they can still help employees reduce the financial stress of unexpected costs. When employees have more insight into what their medical costs look like, they’re able to make more informed decisions about their health — and a healthy workforce will pass those savings on to their employer.
Health care is constantly changing. Stay on the cutting edge of the industry and learn how to control health care costs for your small business by reading Anthem’s Trends in Health Benefits 2018 report.