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Posts Tagged ‘HCTI’

Change Healthcare Q4 Healthcare Transparency Index Shows Widely Varying Prices for Healthcare Services, Reinforces Need for Transparency

HCTI Shows High Price Variability on Imaging, Birth Delivery and ACA-Mandated Preventive Services

BRENTWOOD, Tenn. (May 6, 2014) –Change Healthcare’s latest quarterly Healthcare Transparency Index (HCTI) shows nine medical procedures with high costs and price variances as high as 796 percent. Even within a given network, charges for pharmacy, medical and dental services often vary by more than 300 percent.

“As patients are paying a larger share of their medical expenses – a result of higher co-pays and high-deductible health plans – the need for cost transparency on a consumer level becomes ever more essential,” said Doug Ghertner, president and CEO of Change Healthcare, the market leader in consumer engagement and cost transparency. “Providing patients with the education and information they need to make value-based healthcare decisions benefits the individual and plan sponsors alike.”

Imaging services were the leading area for cost reduction opportunities for plan sponsors and consumers. From an analysis of a database including more than 180 million insurance claims from Q4 of 2013, Change Healthcare found CT scans varied 796 percent from $307 to $2,747 per scan, with an average cost of more than $1,200. Ultrasound costs varied by 411 percent.

Report findings also included inconsistent pricing for vaginal and cesarean section (C-section) deliveries. Vaginal deliveries, ranging 189 percent from $4,359 to $12,613 per delivery, were labeled as a high-cost and high-variance service. Meanwhile, as the prevalence of C-section deliveries increases – 60 percent since 1996, according to The National Center for Health Statistics – so does the variation in cost, which currently spans from $6,680 to $17,619 per procedure.

Five preventive services mandated by the Affordable Care Act (ACA) and provided without charge to consumers were named in the report as opportunities for targeted interventions, particularly among the public and private insurers and employers who are now absorbing all costs associated with these tests and procedures. A standard office visit with a diabetes screening ranged in price by 300 percent, while a screening mammogram showed a 193 percent price variation. Other mandated services included in the report include a screening colonoscopy (189 percent price variation), office visit with lipid screening (183 percent price variation), and an office visit with pap smear (93 percent price variation).

To uncover services with the greatest opportunity for savings, Change Healthcare’s HCTI includes a Transparency MatrixTM, which identifies services that are both high cost and highly variable in price. Examining data from the fourth quarter of 2013, nine services fell into the Change Healthcare Transparency Matrix Target quadrant.  The nine services included:

Service Price Range Price Variability
C-Section Delivery $6,680-$17,619

164%

Vaginal Delivery $4,359-$12,613

189%

Colonoscopies/Upper GI Endoscopies $1,379-$4,242

208%

Office Visit with Lipid Screening $185-$523

183%

Office Visit with Diabetes Screening $121-$485

300%

MRIs $511-$2,815

451%

CT Scans $307-$2,747

796%

Ultrasounds $103-$524

411%

Mammograms $135-$397

195%

The HCTI report, available at http://www.changehealthcare.com/resources/publications/hcti, is a quarterly measure of the costs and cost variability of various medical and dental services that consumers purchase on a recurring basis over time. The source of the healthcare cost data is the aggregation of in-network medical and dental claims from credentialed providers across all Change Healthcare clients, which has geographic coverage that spans nationally and covers more than 7 million lives.

About Change Healthcare

Established in 2007, Change Healthcare is on a mission to transform the way Americans purchase and utilize healthcare services by driving sustainable engagement at the individual level.  With a national client base of health plans and employers covering lives in all 50 states, and more than 7 million users on its platform, Change Healthcare is the premier national provider of healthcare cost transparency and consumer engagement solutions that enable consumers to: Better understand and utilize their healthcare benefits; make informed healthcare purchasing decisions based on quality, cost and convenience; and manage higher out-of-pocket responsibility and realize savings. This, in turn, helps plan sponsors: Control their healthcare cost growth trend; successfully migrate to more cost-effective plan types; optimize existing wellness programs and on-site clinics; and improve member/employee satisfaction and retention. To learn more, visit www.changehealthcare.com.

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The Power of Information in Consumer Hands

Those who have been around me for any length of time know how passionate I am about the need to make the American healthcare system far less daunting for consumers – especially concerning the cost of care, which, for years, seems to have held something of protected status.

With a greater number of U.S. employers striving to curb healthcare costs, often by offering consumer driven health plans, employees and their families are finding themselves increasingly accountable for “shopping” and paying for their healthcare. Now more than ever before, it is critical for patients to understand the costs involved.

Last fall, we introduced our first Healthcare Transparency Index (HCTI) based on several million medical claims in our database from all 50 states.  It looked at prescription drugs and revealed pharmaceuticals offer the highest opportunity for cost savings for consumers – and some pharmaceuticals more than others. The Index received tremendous response, especially from those who’re shopping for prescription drugs and using more of their hard-earned money to do so.

We recently released our second Healthcare Transparency Index, this one focusing on routine medical services.  In the process, we uncovered four key drivers of cost variances in the data – age, “retail vs. traditional office visits,” location and specialty office appointments.  Just a few interesting facts that consumers should take note of:

  • For check-ups and well visits, patients age 40-to-64 will pay up to 26 percent more per visit than 18-to-39 year old patients and in that senior group, internal medicine visits represented the greatest cost variance.  Lesson?  You should be aware that there’s a lot of margin in such visits and you should ask your doctor to help you keep those costs low.
  • A child’s physical for camp, school or sports is much cheaper at a retail clinic versus in your primary care physician’s office, from a high of $160 to a low of $29.  Lesson?  Check your local retail clinic (Minute Clinic; Take Care Clinic; The Little Clinic) for such exams before traipsing off to your doctor’s office.
  • Psychotherapy as a specialty has the greatest variance by market amongst specialty medical care.  Lesson?  You should check the pricing structure of several psychotherapists before setting up an appointment with one because of significant pricing difference for similar-to-identical services.

As the country’s healthcare system moves toward the Accountable Care Organization (ACO) model, where all parties – from patients to hospitals to physicians to payors – are much more holistically involved in care, cost transparency is going to be an important piece of the puzzle.  So indexes or studies like our Healthcare Transparency Index are going to be increasingly vital to the nation’s pocketbooks.

Putting power like that into the hands of consumers makes me feel I’ve done my job.

CDHPs, Consumerism and Cost Transparency

For several years now, my co-workers and I have been advocating market changes that place more information about healthcare costs – and more control of healthcare purchases – into the hands of consumers.  We want to reverse the escalating upward trend of healthcare costs in our country and would like to see healthcare “users” be transformed into healthcare “buyers.”

With the growing presence of Consumer Driven Health Plans (CDHP), we’ve sensed our “new consumerism”  dream growing more attainable.  The remaining challenge though, is  cost transparency.

Healthcare consumerism requires consumers to have “skin in the game,” which is exactly what CDHPs do.  They provide an incentive for employees to be smart about their healthcare purchases.  Yet, it’s also necessary to know the cost of what you’re buying today or in the future relative to your health plan and market so you can make actionable moves.  Costs must be transparent for smart purchases to be made.

That’s certainly what we’ve seen with one of our clients, Thompson Machinery, which we recently discussed in the magazine CDHP Solutions.  When employees embraced CDHPs containing a cost transparency tool that helped them see the true cost of their healthcare purchases, Thompson employees realized, on average, $200 per employee in savings a year.   Multiply that by the number of employees potentially using a high deductible plan (61% of all businesses in 2011 will offer one according to a National Business Group on Health study) and those savings reach well past the millions.

It’s really simple.  When you give employees solid, transparent information about their healthcare and the value-driven choices available, invariably they make far more insightful decisions about their care and its quality.  It puts more control in their hands.  And that simply helps everyone’s bottom line.

We’re excited to see more CDHPs in the marketplace, even becoming the plan-of-choice for many American private-sector workers.  Once these plans are coupled with the kind of effective healthcare cost transparency that companies like ours can bring, I have no doubt that Americans will be able to make savvy healthcare purchasing decisions.

The kind that truly drive down costs.

Massachusetts IS on the Right Track

In an article in Monday’s edition of Boston’s MetroWest Daily News , Kevin Schwartz reported how the State of Massachusetts Legislature, Attorney General Martha Coakley and UMass Medical Center’s Dr. Michael Collins are focused on healthcare insurance premiums that are taking a bigger bite out of individual, state and municipal budgets.  The state appears to be zeroing in on two possible solutions, a global payment system and cost transparency.

In my experience, cost transparency is unquestionably the right approach to take.

Consumers are only beginning to learn that medical, dental and pharmaceutical prices vary a lot, as our inaugural Healthcare Transparency Index, a study of more than a million medical claims data from 50,000 consumers from across the nation over the course of a year, revealed.  The key to reigning in healthcare costs in to ensure patients – who, more and more, are having to become healthcare consumers – are equipped with the tools they need to understand the costs so they can proactively make purchase changes that helps everyone’s pocketbook.

Massachusetts’ My Health Care Options Web site, also mentioned in the story, is a great start for the state.  That will help engage employees/consumers/patients even more.

No question in my mind,  if the Legislature successfully addresses the “cost transparency” issue, they’re well over half way home!

Vanderbilt Healthcare Professor Sounds Off

People tell me that I’m pretty passionate about healthcare – I can get fired up on the topic of cost transparency at the drop of a hat. I never thought anyone would match my enthusiasm on this subject … until I met Dr. Larry Van Horn.

As an Associate Professor of Healthcare Management at Vanderbilt University’s Owen Graduate School of Management, Dr. Van Horn has lots of opportunities to sound off on the issue of healthcare cost transparency and what it means to patients and businesses alike. So we were thrilled when Employee Benefits Adviser captured some of his best arguments in a recent podcast.

During his talk with Editor John Ortman, Dr. Van Horn addresses the need for transparency in order to create smarter healthcare consumers and ultimately, a sustainable healthcare system. He also digs into the data in change:healthcare’s Healthcare Transparency Index (HCTI) and the need for cost transparency today, as consumers are being forced to take more accountability for their healthcare purchasing decisions.

Have a listen and sound off with  your own thoughts below.

Putting Money Where My Mouth Is: Welcome to Healthcare Trendsparency

Like the brothers Jake and Elwood from the movie the Blues Brothers, I have been on a mission. A mission and unwavering commitment to follow-thru on a promise made to de-confuse healthcare for anyone who had to access the health system and was baffled by a lack of transparency about cost and value. I promised to change healthcare for the better.

Sitting here in my office on this random Monday morning, I am really excited (I believe stoked may even be a better description of my demeanor). Today is the first of many days to come where I get to live out my personal mission – with the publication of the first quarterly Healthcare Transparency Index and the launch of this blog to support it.

After losing my parents to cancer in 2006, I was obviously overwhelmed with grief. Adding insult to injury was the confusing mess of medical bills and unanswered questions about their care that was left behind. During one of the worst and darkest times of my life, where the last thing I wanted to think about was money, I gained an amazing clarity about an issue that’s plaguing healthcare today – and one that I naively believe we can (nay, must!) fix.

No one argues that our current healthcare system is a mess – we’re all easily on board with that. But the number of theories about its core problems and how to fix them are astronomical. I bet you’re following 17 other blogs that say we need to focus on technology, quality or processes – all of which have their place. But, with that said, here are a few promises to our readers about this blog’s mission and why this one is different.

  • We will show you the money – Does anyone even know what healthcare really costs? Because of the way the our healthcare system is inherently set up, we’ve all been shopping without price tags, the wool has been pulled over our eyes, another day another dollar – whatever cliché description you want to use to describe it. This blog is going to expose what the government, pharmaceutical companies, hospitals and insurance companies don’t seem want anyone to know – the true costs of procedures, routine care and prescriptions.
  • We will back patients and employers – For the most part, employers and the employees they are trying to insure have been the biggest victims of the mess that healthcare has become. Because of the rising cost of healthcare, employers can’t afford to cover employees the way they used to, and employees are now forced, for the first time, to become really “involved” with their healthcare and make decisions about care that they never had to before. This blog is intended to guide employers and their employees on how to become smart consumers of healthcare.
  • We will advocate discussion, welcome debate and receive challengers – We know not everyone will agree with our opinions and perspective – even if they’re backed by three years and $220 million of medical claims data. Even if the most recent research points to a rising number of companies insuring their employees through a consumer directed health plan, we’re used to the arguments against it. So we’re asking you to please read, weigh in, ask questions and consider.

I hope that after you check out a few posts, you’ll be as excited as I am.