Report Offers Ways to Fix ‘Hot Mess’ of Health Plan Price Transparency Data

Although health plans have started to comply with a federal transparency rule that requires them to publicly post reams of information about provider payments, “multiple problems have rendered the published data largely inaccessible and unusable,” according to a new report.

The report, produced by Georgetown University’s Center on Health Insurance Reforms (CHIR), is the product of a recent collaboration between a slew of prominent health policy and economics researchers who were convened by CHIR Director Sabrina Corlette. The idea was to develop recommendations that would make the “Transparency in Coverage” regulation more effective in its quest to shine a light on health care cost information.

Starting July 1, 2022, one key provision of HHS’s Transparency in Coverage rule requires all non-grandfathered group and individual health plans to publish their negotiated rates with in-network providers and historical allowed amounts to out-of-network providers in “standardized, regularly updated machine-readable files.”

Once the new rule went into effect, “I very quickly heard from folks in the research community that were trying to dig into these data files — as well as health plans themselves and actuaries and employer groups — that the files were inaccessible to many unless you had a big supercomputer,” Corlette tells AIS Health, a division of MMIT. Stakeholders also reported “that if you could get in, [the files] were hard to parse and navigate — just a hot mess,” she adds.

“To put it in lay terms, trying to locate a single provider in the TiC [Transparency in Coverage] files is akin to trying to find a single word in a very large dictionary that isn’t in alphabetical order,” the CHIR report states.

Thus, Corlette asked researchers, professors and others from institutions including Harvard University, the Health Care Cost Institute, RAND Corp. and the Purchaser Business Group on Health to brainstorm how to fix the data-reporting issues. The result is a document that contains suggestions for how to reduce data redundancy and improve accessibility, usability and data quality. Some examples include:

  • Reducing frequency of reporting from monthly to quarterly or biannually in order to both give users more time to analyze data and reduce the compliance burden on issuers;
  • Maintaining a repository of issuers in compliance with the rule (including links to their data sources), while also publicly identifying issuers that are not in compliance;
  • Requiring clearer and standardized labels on each file;
  • Reviewing a random sampling of files to assess data quality during each posting period, and requiring issuers with poor data quality to take corrective action; and
  • Convening and maintaining a standing group of technical experts to advise CMS on ways to improve accessibility and data quality.

Katherine Hempstead, Ph.D., a senior policy adviser at the Robert Wood Johnson Foundation and one of the experts who helped develop the CHIR report, says she hopes fixing the insurer-reported data will allow that information to be used to its full potential.

“So far there has been very little data availability for non-commercial use, meaning that researchers, advocates, journalists, employers, state policymakers, and the public are not benefiting from this required reporting,” she tells AIS Health. “Entities without millions of dollars to spend on cloud computing and coding are not able to get much out of these data, which is a shame. The required reporting is an incredibly powerful tool, but right now the potential for public value is unrealized.”

Now that the experts’ recommendations have been gathered and published, CHIR’s plan is to share the document with staff and lawmakers on Capitol Hill as well as CMS. “The idea is to say, look, this is fixable. It doesn’t require a major new piece of legislation; it doesn’t even require a huge expenditure of resources by the plans,” Corlette tells AIS Health. “But if the goal is to have this data available to people who can do something with it to improve affordability, to address costs in the system, there do need to be some fixes made to enable the data to be usable.”

Trump Admin Hoped Tech Firms Would Leverage Data

When it finalized the Transparency in Coverage rule in 2020, the Trump administration said it hoped that making negotiated rates for health care services public “would open new opportunities for research and innovation to drive improvements within the health care market.”

For example, “technology companies can create additional price comparison tools and portals that will further incentivize competition, as well as allow for unprecedented research studies and data analysis into how healthcare prices are set,” CMS said at the time. “With this information available to the public, there can finally be pressure on those that price gouge consumers when they are at their most vulnerable.”

CMS estimated that complying with the new regulations would cost insurers and third-party administrators at least $3.8 billion in the first year of implementation, with further costs expected in later years.

The rule was not the only transparency-focused regulation passed by the Trump administration; it also required significant new disclosures from hospitals. The hospital price transparency requirements have been in effect for longer, and have garnered criticism for the industry amid health systems’ reportedly spotty compliance.

In fact, an October 2022 report from PatientRightsAdvocate.org compared hospital disclosures with the newer insurer-reported cost data and suggested that providers still have room for improvement. The advocacy group wrote that “some of the prices that are found in insurance company price files appear with an ‘N/A’’ or are blank in the corresponding hospital price list. This concrete evidence from the insurance files demonstrates that real prices exist and hospitals are flouting the hospital price transparency rule.”

The American Hospital Association (AHA), however, wrote in a June 2022 post that estimates of hospitals’ compliance varies widely depending on which organization is doing the assessing.

“The AHA strongly cautions against buying into misguided ‘assessments’ of hospital compliance with the price transparency rule,” she added. “Hospitals are working hard to provide accurate financial estimates for patients. This is challenging work and requires consideration of both hospital rates and patients’ health care coverage.”

A more recent analysis from the Journal of General Internal Medicine, meanwhile, found that just 19% of hospitals are fully compliant with CMS price transparency rules.

Health Plan Compliance Is Tricky to Gauge

As for the health insurance industry, “the problem is we can’t say much about plan compliance” with price transparency regulations, Corlette says. “We know there are files being posted, but whether the data that those files contain is an accurate reflection of what carriers are actually paying, that’s hard to say, because the research community and the regulator community can’t really get in to assess that.”

In addition to the price transparency requirements that went into effect in July, as of Jan. 1, 2023, almost all commercial health plans are now required to provide their members with online shopping tools that allow them to see the negotiated rate between their provider and their plan. They must also provide a personalized estimate of their members’ out-of-pocket costs for 500 of the most shoppable items and services. And by Jan. 1, 2024, those shopping tools will have to show the costs for all remaining items and services.

Corlette points out that many major insurers already had price-shopping tools available to consumers, but it’s not clear “how much rejiggering or tinkering was involved in coming into compliance with the federal requirements.” Ultimately, it may prove especially difficult for organizations like CHIR to assess how insurers are responding to the consumer-focused price transparency requirements, since health plans have to provide such tools only for their enrollees, not the public at large, she adds.

Contact Corlette at sabrina.corlette@georgetown.edu and Hempstead at khempstead@rwjf.org.

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Leslie Small

Leslie Small

Leslie has been working in journalism since 2009 and reporting on the health care industry since 2014. She has covered the many ups and downs of the Affordable Care Act exchanges, the failed health insurer mega-mergers, and hundreds of other storylines spanning subjects such as Medicaid managed care, Medicare Advantage, employer-sponsored insurance, and prescription drug coverage. As the managing editor of Health Plan Weekly and Radar on Drug Benefits, she writes and edits for both publications while overseeing a small team of reporters who also focus on the managed care sector. Before joining AIS Health, she was a senior editor for the e-newsletter Fierce Health Payer, and she started her career as a copy editor at multiple local newspapers. She graduated with a dual degree in journalism and political science from Penn State University.

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