Healthcare cost information will soon be accessible to everyone across the healthcare ecosystem. Finalized by the Departments of Health and Human Services, Labor, and the Treasury on November 12, 2020, the Transparency in Coverage rule puts healthcare price information in the hands of consumers, providers, and health plans to empower stakeholders with the information they need to make informed healthcare decisions. Health plans have the opportunity to tap into the data to gain insights into competitive rates and guide their pricing and contracting strategies.
As healthcare costs continue to rise, understanding how rates compare to specific payers, providers, and services is even more crucial for staying ahead of the competition. According to CMS, U.S. healthcare spending grew 9.7% in 2020, reaching $4.1 trillion or $12,530 per person. As a share of the nation’s GDP (gross domestic product), healthcare spending accounted for 19.7%.1 The Transparency in Coverage rule will allow everyone in the healthcare ecosystem to have greater insight into healthcare costs.
Promoting Competition and Strengthening Negotiating Power
The Transparency in Coverage rule is expected to inspire and promote competition through greater visibility into pricing intelligence. By requiring plans to disclose in-network negotiated rates, billed charges, and allowed amounts for out-of-network providers, the rule can help plans fine-tune their client growth and retention decisions in an already highly competitive marketplace. The information will also help drive innovation and promote stronger networks, pricing, and contracting strategies.
With mandated pricing information available through machine-readable files (MRFs), health plans can now better understand their competitors and relative competitive positions. They can also use competitors’ pricing data to unlock value in local markets.
The data can help plans:
- Optimize pricing strategies—by provider or service—to be competitive across markets
- Refine networks to benefit clients and members
- Inform client acquisition and retention strategies
Armed with reimbursement benchmarking and cost transparency information, the plan’s provider networking and contracting teams can gain insights into regional and national cost benchmarks for services, compare services across specialties, and optimize unit cost position in fee-for-service contracts. In addition, the plan’s sales team can gain competitive intelligence to guide opportunities based on pricing network advantages.
Making Sense of Terabytes of Data
Given the volumes of data health plans are required to share, files for an individual health plan can add up quickly. And new files are released every month. Analyzing and making sense of reams of national data require significant computing, data, and analytics resources. When the data isn’t engineered appropriately, it can grow to trillions of rows to manage.
To help plans stay ahead, Blue Health Intelligence® (BHI®) offers Transparency Analytics, an intelligence solution that can help transform curated MRF data into valuable insights for reimbursement benchmarking, network analysis, and cost transparency. Depending on the plan’s needs, Transparency Analytics can be accessed through a cloud-based data mart that enables the plan’s analytics team to respond to honed internal use cases. And insightful data visualization reporting compares pricing, networks, and rate file completeness to other health plans in the plan’s service area. Both options save plans extraordinary time aggregating, organizing, and enriching the data to build deeper views of competitor pricing variation and contracting strategies.
BHI employs the following process to ensure its Transparency Analytics data is relevant, timely, complete, and consistent:
Partnering with Blue Health Intelligence
BHI’s Transparency Analytics delivers the information health plans need to make sense of Transparency in Coverage data. Our offering is actively leveraging the latest national health plan MRF data, enriched with world-class data assets for national and plan-specific data. BHI is working closely with early adopters to drive data views and visualization tools that support business initiatives and accelerate speed to insights. Transparency Analytics uniquely combines MRF data with claims data for 200+ million claimants to enable weighting factors specific to provider and service and to generate more accurate pricing efficiency measures. The combined power of BHI’s national data, the plan’s data, and MRFs simplifies analytics and provides greater visibility into the competition.
For more information about the rule, download our Transparency Analytics FAQs. To schedule a free consultation to determine how BHI’s Transparency Analytics can help improve your competitive positioning, contact us today.
ABOUT THE AUTHOR
Chris Birkmeyer is Senior Vice President of Data Analytics at Blue Health Intelligence® (BHI®) and drives BHI’s provider analytics and data science efforts. Chris brings a wealth of expertise in provider and health plan analytics as well as the development and application of advanced analytics and machine learning.