Presentation by Laura Medford Davis for the Third Annual Policy Prescriptions® Symposium Laura Medford-Davis is a Robert Wood Johnson clinical scholar at University of Pennsylvania and a practicing emergency physician. The symposium is designed for clinicians, healthcare workers, and healthcare executives interested in exploring the major themes that will emerge in health policy throughout the year. This year, the symposium will emphasize value in healthcare, health information technology, gun violence, insurance choices, the Affordable Care Act, and the viewpoints of the Presidential candidates on health care.

1. Defining Value in
Healthcare Through Price
and Cost Transparency
Laura Medford-Davis, MD MS
@MedfordDavis

2. The Following Presenters Have Disclosed Relevant Financial Relationships:
Cedric Dark, MD MPH FAAEM FACEP
Community Health Choice, Event Sponsorship; Schumacher Clinical Partners, Event Sponsorship
Seth Trueger, MD MPH
Emergency Physicians Monthly, Employee, Salary
The Following Presenters Have Disclosed No Financial Relationships:
Megan Douglas, JD
Elena M. Marks, JD MPH
Laura Medford-Davis, MD
Bich-May Nguyen, MD MPH
The Following Planners Have Disclosed Relevant Financial Relationships:
Cedric Dark, MD MPH FAAEM FACEP
Community Health Choice, Event Sponsorship; Schumacher Clinical Partners,
Event Sponsorship
The Following Planning Committee Members and Staff Have Disclosed No
Relevant Financial Relationships:
Emily DeVillers, CAE
Kay Whalen, MBA CAE
Janet Wilson, CAE
I have nothing to disclose.

3. Objectives
• Evidence: Benefits of transparency
• Policies around transparency
• Resources for transparency

8. Health care biggest source of debt

9. 1/3 of people with medical debt cannot pay for other
basic needs; 2/3 cannot pay other general bills

10. 2/3 of people who struggle to pay medical
bills are insured

11. High Deductible Health Plans &
Out-of-Network

12. Out-of-Network Bills

13. Percent of Covered Workers in a Plan That Includes a
Deductible, 2006-2015
55%
59% 59%
63%
70%
74%
72%
78%
80% 81%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

14. Average deductibles >$1,200 for Employer-
Sponsored insurance and >$2,900 for Obamacare

15. Less than 1 in 6 doctors consistently discussing
costs with patients

16. 79% say shopping for health care is difficult,
and 67% who tried to negotiate were
unsuccessful

17. Objectives
• Evidence: Benefits of transparency
• Policies around transparency
• Resources for transparency

18. Evidence is Mixed
• Patients informed of MRI costs and options pre-MRI
– 18% cost reduction
• Employer offered a price transparency tool
– Tool used before 6% of claims
– Those who used it were more expensive pre-tool
– 14% cost reduction
• Employer offered a price transparency tool and
another did not
– 10% of employees used it
– $59 price increase

19. Objectives
• Evidence: Benefits of transparency
• Policies around transparency
• Resources for transparency

20. Best Practices for Transparency
• Estimates tailored to the patient, provider, and
insurance plan
– Specific prices, not averages, medians, or ranges
• Quality information
• Real-time availability

21. Problems with Current Transparency Tools
• Episodes not clearly defined
– CPT codes
• Limited number of services included
• Not linked to quality
• Hard to keep up-to-date with inflation and contract
changes
• Skewed by overutilization (and underutilization)

22. Price and Complication Variation – Medicaid
Vaginal Delivery (HCi3)

23. Barriers to Transparency
• Non-disclosure agreements
• Price protected under Trade Secrets
• Most-Favored Nation clauses
• Anti-tiering clauses

24. HCi3 – State Report Card on Price
Transparency Laws

25. 28 States Have Price Transparency Laws
• Allow states to collect information
• Require hospitals to disclose to the state
• Average charges or chargemasters
• Price disclosure upon request

26. States with Stronger Laws
• MA & WA: Insurance companies → Patients
• KS: Insurance companies → Providers
• CO: public all payer claims database
– Hospitals → Patients (average cost)

27. California: Price, Price change, Quality

28. Florida Hospital CompareCare

29. Florida # of Hospitalizations, Charge Range,
and Average Length of Stay

30. Oregon PricePoint: Volume, LOS, Price

31. New Jersey Price Compare: Volume, Price

32. Objectives
• Evidence: Benefits of transparency
• Policies around transparency
• Resources for transparency

33. Dartmouth Atlas of Health Care

34. Dartmouth Atlas of Health Care
$219,591.42
$141,546.80
$119,526.19
$119,299.22
$117,916.27
$102,629.93
$99,255.48
$82,744.36
$77,528.25
$68,835.92
$42,120.81
$0.00
$50,000.00
$100,000.00
$150,000.00
$200,000.00
$250,000.00 1. Los Angeles Community Hospital
37. MD Anderson Cancer Center
97. Brigham & Womens
98. Hospital of the University of Pennsylvania
113. Park Plaza Hospital
266. St Lukes Episcopal
328. Memorial Hermann Medical Center
841. Cleveland Clinic
1093. Scott & White Memorial
1687. Geisinger
2074. Brookings (South Dakota)

37. Health Care Cost Institute - Guroo.com

38. Health Care Cost Institute - Guroo.com

39. Screening Colonoscopy

40. Screening Colonoscopy

41. Objectives
• Evidence: Benefits of transparency
• Policies around transparency
• Resources for transparency

42. Key Takeaways
• We have a lack of transparency in the USA
• Evidence on the benefits of transparency is mixed
• The majority of states have “policies” but most are
weak and ineffective
• Resources for cost comparisons exist, but most
provide averages or insurer-specific information

43. Questions