When I started this company around the concept of transparency, there was a lot of talk about the lack of it in healthcare. Like the promise of the EHR/EMR, which took government incentives to gain momentum, progress on the transparency front came at a snail’s pace and was mostly voluntary.
Meanwhile, consumer frustration and political rhetoric about healthcare costs continued to intensify. Prescription drug prices were often a focal point. Some forward-thinking employers and health plans took the initiative, adopting prescription price transparency and member advocacy solutions.
Soon all commercial, Medicare Advantage and employer-sponsored plans will be required to follow suit—at least with respect to transparency. At Rx Savings Solutions, we’ve always believed it goes hand in hand with advocacy.
The Case for Transparency
In the decade or so that we’ve been in the transparency business, the healthcare and pharmaceutical industries have operated under looming threats of mandated reform, price controls and a multitude of proposed regulations.
I’ve always felt a better path is to give the people who care most about the cost of care the information they need to avoid paying more than they should. It’s how efficient markets function. If we’re going to shift more of the cost burden to consumers, they deserve the ability to be informed consumers.
We’ve seen what happens when they are:
- Consumers with access to our service always know when there’s a different form, dose, therapy or fulfillment option that will cost less out of pocket.
- When they convert to a lower-cost option, they preserve their own healthcare dollar and reduce the health plan’s pharmacy spend with each successive fill.
- Affordability improves adherence to maintenance medications and helps avoid expensive medical claims while also supporting better health outcomes.
New Rules
Transparency is no longer voluntary. Center for Medicare and Medicaid Services (CMS) rules for hospitals, private insurers and Medicare began taking effect this year. Those that affect the pharmacy space include the Transparency in Coverage Final Rule (CMS-9915-F) and CMS-4190, the January 2021 final ruling on Medicare Part D regulation.
Are these regulations a good thing? It depends on whom you ask. So far in 2021, hospitals have been slow to comply with their price transparency rule, and some are looking for ways to bypass its requirements. Yet even opponents probably prefer guiderails like these CMS rules to legislative reform or price controls.
The way I see it, transparency is always a good thing. Time will tell whether plans use the rules to their advantage or simply check a box. My hope is everyone will think about the people who ration or won’t fill life-sustaining prescriptions because they can’t afford them, or don’t know affordable options exist.
Compliance ≠ Innovation
Transparency means different things to different groups. Not everyone needs the same level of it, nor will all manifestations be equal.
For example, when it comes to prescription drugs, consumers need visibility into covered therapy options for their conditions (forever a huge missing piece), as well as the out-of-pocket prices of each. They have no need for list prices, average wholesale prices, wholesale acquisition costs or gross-to-net deltas. But benefits leaders and brokers sure do.
And there’s a big difference between a health insurer posting a hundred-page PDF formulary and price list on its website and presenting that data in meaningful context in a consumer-friendly interface. One makes you compliant for now. The other enables comparison shopping similar to Amazon or Airbnb—the pictures just aren’t as fun.
We shared the floor with our partner Accolade on this very topic at Business Group on Health’s recent annual conference. We both believe data—or transparency, for that matter—isn’t worth much unless it’s packaged in a member-focused way.
When the goal is helping members navigate the complexities of their healthcare journeys or prescription drug benefits, data transparency is the foundation. But alone, it won’t do the trick. It has to produce clear, quick insights that are easy to act on. Member engagement and advocacy are critical components to action.
We’ve proved it’s a combination that works, even before transparency became a rule. Employers and health plans have the opportunity to take advantage for their members’ sake, as well as their own.
