Pricing Transparency & the Impact to Consumers

What is the Transparency in Coverage Rule?

Prior to July 1,2022, most consumers of health care services were unaware of how much they cost, including myself.  My primary concern was whether it was a covered service and how much the copay or coinsurance was going to be after the insurance company processed the claim.  It never occurred to me that some providers may be charging vastly different prices for the same services.  The reality is that providers do have different rates for the same services.  The Transparency in Coverage (sometimes referred to as TiC) rule allows consumers to know the cost of a covered item or service before receiving them.

Beginning 1/1/2023, the Transparency in Coverage rule required that health insurance companies provide their members with an online tool that allows them to compare pricing data between different providers for several hundred covered services.  According to the rule, consumers should have the ability to access all their covered services using this same tool to make price comparisons no later than 1/1/2024.

How has this rule impacted the way consumers access healthcare services?

For me, the availability of price comparison data for my healthcare services is used to help me understand my potential out-of-pocket costs before I schedule services.  Even more importantly, this new ruling enables me to know how much of the cost is my responsibility before receiving the Explanation of Benefits (EOB) from the health plan.  Gone are the days when I would receive a bill from a provider indicating that I was responsible for tens of thousands of dollars for services rendered.  And yes, this did happen to me several years ago.

Providing consumers with this level of detail about their healthcare costs allows us all to engage in a more consumer-driven experience.  We now have tools to help us decide which providers we want to use, and this empowers each of us to play an important role in controlling the cost of our healthcare services.  As the saying goes ‘Knowledge is Power’ and it most certainly applies in this case.

Compliance with the Transparency in Coverage Rule

The good news is that health plans are complying with the Transparency in Coverage (TiC) rule and successfully implementing data processes and software applications to support this rule. Of course, this rule will continue to be refined and the processes in the background within health plans will continue to improve and evolve.  In the end, we will all benefit from the Transparency in Coverage (TiC) ruling by better understanding what is covered by our health insurance as well as managing the expected financial responsibility of our health care services.

Operationalizing Transparency in Coverage (TiC)

Making provider price comparison data available for use in an online tool for consumers is a massive undertaking for any health plan.  The data needs to include rates used for all covered items and services by in-network providers.  In addition, the allowed amounts, and billed charges from their out of-of-network providers are required.  Typically, this data is spread over multiple systems within a health plan, and consolidating the data is no easy task.

HealthEdge offers a suite of products to enable health plans to consume and transform the data needed to comply with this regulation.  Specifically, we can support health plans in the following ways:

• Adhere to the CMS mandate by understanding the health plans needs and system customizations
• Provide data in the required format that includes data dictionary updates
• Allows on-demand and monthly rate updates per contract configurations
• Enables data files access via SFTP line so they can be used to generate comprehensive rate lists

Learn more about HealthEdge’s suite of products here.