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The Trouble with Hospital Price Transparency

Philip Betbeze, for HealthLeaders Media, March 14, 2014

Many hospital and health system leaders acknowledge that if prices were more transparent, they would compare favorably with their peers and be able to attract more patient volume. So why isn't it happening?

When I talk to healthcare CEOs about how the negotiation dynamic is changing between the provider side and the payer side, they can provide lots of examples of how it's changing. In many regions, they're collaborating on risk-based contracts, forming accountable care organizations, and in general, getting better about sharing with each other what had previously been proprietary information: claims data and outcomes.

That information is critical to trying to improve the cost and quality of healthcare—a goal acknowledged by just about everyone involved.

But among many who are not yet benefitting from these innovations have not yet arrived, I hear a note of resignation. Often, they're leaders whose hospitals or systems are still negotiating fee-for-service contracts with commercial insurers. In these cases, innovations such as narrow networks, risk-reward contracting, and accountable care organizations are just something they hear about that other people are doing.

In my latest article in HealthLeaders magazine, I look into the reasons why that happens, and a few possible solutions to drive greater healthcare price transparency.


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But why are these leaders resigned, and in some cases, even a little depressed about their ability to compete on a level playing field? Largely, it's because these people are running hospitals and health systems that are already among the lowest-cost, highest quality organizations in their geographical regions, yet they can't effectively leverage those attributes because of a variety of factors that seem beyond their influence.

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