Bringing transparency and lower costs to health care
In nearly every industry, we are able to shop for goods and services by comparing publicly available price and quality information. From buying shoes to building a house, we expect to know the full price of what we are purchasing before we buy it.
In health care, however, patients rarely know how much they will pay for medical services before receiving them. In contrast to the transparency found elsewhere, the opaque nature of health care pricing makes comparison shopping virtually impossible in most states. When the bills eventually arrive, they can be shocking.
Americans increasingly pay more out-of-pocket for their health care, so it is crucial that they have access to the information they need to make informed decisions. The health and economic crisis we are currently experiencing due to COVID-19 has underscored the need for Congress to come together to increase the affordability and accessibility of medical care.
The Health Care PRICE Transparency Act I co-sponsored would significantly increase transparency. This commonsense bill would help promote competition among providers and ensure consumers pay the lowest possible price for care. By making the price of health care services available to consumers in advance, this legislation would empower patients.
The Health Care PRICE Transparency Act would require hospitals to provide patients with clear, accessible information about their standard charges for items and services, making it easier to shop and compare across hospitals and helping to prevent unpleasant surprises. In addition, the bill would require insurers to give consumers real-time, personalized access to cost-sharing information and disclose their negotiated rates for in-network providers and allowed amounts paid for out-of-network providers. This information, available online and in paper form, would allow consumers to shop and compare costs prior to receiving care.
As the Chairman of the Senate Aging Committee and a member of the Senate Health Committee, I have seen how transparency reforms can lower prices for patients. In 2018, I authored the Patient Right to Know Drug Prices Act that prohibited an egregious practice that prevented pharmacists from disclosing to their customers whether there were less expensive ways to pay for their prescription drugs. These pharmacy “gag clauses” hid cost information from consumers and caused them to needlessly overpay. In fact, before my bill became law, nearly one out of four prescriptions filled through insurance ended up costing more for customers than if they had paid out of pocket.
By ensuring patients have this accessible cost information, Americans are now able to save at the pharmacy counter. This same principle can be applied to patient care in general. Currently, the lack of transparency across the entire health care system limits patients’ ability to get the information they need to shop for care that fits their needs and budget. The Health Care PRICE Transparency Act is a straightforward solution that would both lower costs and improve care for the people of Maine and throughout the country.