Despite the current state of political gridlock, there is one area where bipartisan common ground continues to exist: the desire for real healthcare price transparency. A recent poll showed that 96% of Americans across the political spectrum are in favor of the idea that patients deserve to know the price of healthcare before receiving it.
Healthcare price transparency is a crucial step in fixing the broken healthcare market. It allows for better, more accurate price signals, empowering patients with key information that enables them to shop for non-emergent healthcare goods and services. This, in turn, drives up competition, which lowers prices.
The current lack of transparency is staggering. Prices for the same procedure can range nearly 10-times, and even the same procedure within a given hospital can have wildly different prices based on backroom negotiations and often arbitrary price tags. This opacity is unacceptable, especially when over 40% of Americans have healthcare debt and more than 40 million Americans are on high-deductible health insurance plans.
The sheer amount of money spent on healthcare in our economy is staggering. We spend about one in every five dollars, approximately $5.3 trillion. However, we don't know what we get for this money. A large proportion of our country's spending is healthcare coverage, including over 150 million Americans who have insurance through their employers. Yet, even employers don't know what they get for the money they spend for their employees, nor do they know the price tag of healthcare goods and services upfront.
Healthcare price transparency can improve employer plan management and strategy, removing one element of the "healthcare unknown" and eliminating bureaucratic and inefficient frustrations and waste. Employers can then focus on demanding insights on quality of care, a logical next step to build upon price transparency.
Savings on employer health insurance plans mean more money in employee pockets through higher take-home wages not spent on coverage. With a family of four spending about $27,000 per year on health insurance, that's a lot of money families across America desperately need.
Healthcare price transparency efforts will not only help everyday Americans today but also accelerate innovation. When competition exists, innovation follows, as organizations try to differentiate themselves and get an edge over their competitors. The possibilities for care delivery model improvements, including the use of AI, and entrepreneurs making healthcare price transparency data easier for everyday Americans to quickly digest are numerous.
The data on savings are clear. Studies demonstrate the potential savings are in the billions of dollars, with one study estimating savings between $17 billion to $80 billion and another study estimating about $120 billion (with a plausible range of $25 billion to $270 billion) of savings over time. It's a bold, necessary start in "fixing" healthcare.
Now, Congress must act. It's past time for healthcare price transparency to be the law of the land, not just a collection of executive orders and CMS rules. And nearly all of America agrees.
