To understand how health systems are approaching these data-sharing rules, the Deloitte Center for Health Solutions conducted a survey in the fall of 2020 with 30 finance executives (CFOs, finance VPs, and revenue cycle VPs) of large health systems (revenue greater than US$500 million). Four main themes emerged:
- Price transparency and interoperability are valuable: Sixty-two percent say care coordination and quality of care will improve due to these data-sharing initiatives.
- Many respondents are planning to review and respond to their competitors’ prices: Fifty-seven percent intend to conduct an analysis of prices in their markets and 53% are likely to adjust their prices as a result of the rule.
- Consumer experience focus continues: Top consumer engagement capabilities that health systems intend to develop include online scheduling (70%), cost estimation apps (53%), and innovative payment financing options (53%).
- Payer-provider innovation will grow: Sixty percent of health systems intend to directly contract with employers and 50% of health systems will seek more collaboration with payers.
Even as health systems work to comply with today’s regulations, they should prepare for future requirements and use these programs as part of their broader competitive, financial, and digital strategies. Investments could include:
- Conducting market analyses to help drive strategic decisions. Organizations should seek to understand how they measure up against competitors on price, quality, and outcomes. This data could then support decisions about consumer engagement, pricing, and other strategies.
- Developing or refining a consumer engagement strategy and executing on it. Organizations should determine how they will better engage consumers through data-sharing, interoperability, and price transparency and whether they will buy, build, or partner for certain needed capabilities.
- Designing for consumers. Initiatives resulting from these regulations should be designed for the end user and provide a consumer-friendly experience across the entire patient journey—from customized pricing estimates and communications to scheduling and access.
- Leveraging technology partners for needed capabilities. Organizations should assess vendors currently in the market and keep an eye out for new entrants that can help build desired capabilities. One example might be a digital platform for dynamically setting prices, such as the use of bots that respond to some consumer inquiries, patient-liability estimators, scheduling tools, and other consumer needs.
- Putting in place a system for tracking and monitoring consumer inquiries. Data from such a system can help organizations understand the impact of published prices on consumer sentiment.
- Collaborating further with payers. Health systems should develop a plan to use opportunities with payers on pricing estimators, care coordination, and quality initiatives.
Price transparency and interoperability require significant investments by health systems. Organizations are required to publish standard charges and negotiated rates with health plans for certain services and share patient data seamlessly with consumers, payers, and other providers. Upcoming requirements, such as the Transparency in Coverage final rule for payers or expansion of the list of shoppable services under the Hospital Price Transparency Rule, will likely accelerate data-sharing. Organizations that are most prepared for a long-term journey toward greater transparency and interoperability will likely not only comply with the regulations, but will also approach these steps strategically to gain a significant long-term competitive advantage.
Introduction: Primer on the rules and broader government context
The 21st Century Cures Act (Cures Act) contains key provisions to increase patients’ access to their electronic health information (EHI), drive interoperability, and address information-blocking practices. CMS and ONC released final rules to implement the Cures Act’s interoperability provisions and facilitate data exchange. Further, the administration released price-transparency final rules for hospitals and health plans. These rules aim to drive data-sharing in the industry and give consumers greater control of their health data and encourage market competition—and lower costs—by letting consumers shop and compare prices.
Under the CMS Interoperability and Patient Access final rule, organizations are required to share claims and other electronic health information with patients via application programming interface (API) technology, which allows patients to access their data from their smartphones. The regulations intend to make it easier for patients to access certain claims and encounter information (including costs), and they establish new requirements for hospitals to send automated electronic notifications when an individual is admitted, discharged, and/or transferred to another facility to better enable care coordination.
The Affordable Care Act (ACA) established requirements for hospital price transparency. Last year, CMS and HHS built on this provision by issuing final rules requiring hospitals to publicly share standard prices for 300 “shoppable services,” or nonurgent procedures that can be scheduled in advance. Beginning on January 1, 2021, hospitals are required to provide machine-readable lists of standard charges for procedures, including gross charges, minimum and maximum negotiated charges, and rates that hospitals negotiate with health plans and other payers. Hospitals must update the data at least annually.
The administration released a similar rule for health plans. Health plans must publicly share machine-readable data on negotiated rates with in-network providers, payments to out-of-network providers, and covered drug costs on a monthly basis, by January 1, 2022. Additional requirements in subsequent years will require plans to provide a tool to estimate consumers’ out-of-pocket expenses.
Also, as part of the Hospital Inpatient Prospective Payment Rule of 2021, CMS requires hospitals to include the median plan-specific negotiated rates with Medicare Advantage (MA) plans and other insurers by Medicare Severity-Diagnosis Related Group (MS-DRG) in their Medicare cost reports for cost-reporting periods beginning on or after January 1, 2021. Importantly, hospitals must satisfy Medicare cost-reporting requirements to remain eligible to participate in Medicare.