Wisconsin Insurance Providers Increase Cost Transparency

Published August 1, 2008

Insurance-providing members of the Wisconsin Association of Health Plans have pledged to make health care costs more transparent to enrollees.

By September 1, 2008 all 17 members of the association will provide consumers with estimates of out-of-pocket costs for various procedures.

Analysts say the initiative will have a positive impact on the market by encouraging patients to be more aware of the costs of their health care.

Increasing Trend

“Any step that encourages patients to be more aware of the actual cost of the care they receive is a step in the right direction,” said Kalese Hammonds, a health care policy fellow with the Texas Public Policy Foundation. “It may encourage people to be selective in the care they choose to pursue.”

Phil Dougherty, executive director of the Wisconsin Association of Health Plans, said a few of its insurers had already adopted efforts to provide more cost information to patients.

“Over time both health care providers and health plans have been working on providing standardized measures of health care,” Dougherty said. “Increasingly there are more organizations out there providing that information, as consumers are bearing more of the cost of health care.

“Our effort is to get more cost-related information into the hands of consumers,” Dougherty said, “so they can make judgments of value that will put them in a better position to determine if it is right to obtain this health care service from this provider.

“As a whole, each of our members decided this is what they can do, and in a short time frame reach out to our members and let them know this information is available,” Dougherty said.

Shared Responsibility

Experts were quick to note providers, insurers, and consumers must all take the responsibility to disclose and verify cost information.

“Any time an industry responds to consumer demands, it benefits the consumers and the profitability of that business,” said Hammonds. “Progress towards transparency in health care is always a positive development, but these insurance companies should be careful that the estimates they give their consumers are accurate, or there could be a backlash from consumers who end up paying more than they expected.”

“This is a responsibility for everybody who is involved in the health care system,” said Dougherty. “The provider is as much involved if not more.”

“In order for insurers to provide their clients with this information, they will have to know what the doctors charge,” Hammonds added. “One would hope that once this information is reported to these companies it would be kept on file and made readily available to consumers who request pricing information. How available or accessible pricing information will be is ultimately in the hands of the provider, who has the option of disclosing it to consumers.”

J.E. Loomis ([email protected]) writes from Indiana.