How Patient Price Transparency Creates Hardships for Rural Hospitals (and what to do about it)
While most experts generally agree that today’s healthcare consumers want—and need—to understand healthcare costs, the question is this: What’s the best way to enable it?
The well-intentioned price transparency rule requires hospitals to provide patients with price transparency tools. Unfortunately, these tools ultimately create more confusion for patients and require revenue cycle management staff to provide ongoing patient education—a step that’s often particularly difficult for today’s rural providers that are already short-staffed and facing financial hardships, says Jeneisa Sudbrink, CRCE, Chief Operations Officer at Inland RCM.
“I think a lot of people in our field agree with me that requiring hospitals—particularly rural ones—to broadcast their charges without any context for understanding is not the answer,” she says. “Chargemasters are incredibly complicated, and what patients see in hospital price transparency tools is often a data dump. Patients may not even be looking at the right codes and costs, so they really have no idea what they’re purchasing.”
This confusion is evidenced by recent industry news regarding hospital compliance with the price transparency rule. In February, Patientrightsadvocate.org published a report stating only 34.5% of the 2,000 hospitals it reviewed are compliant with the federal price transparency regulations implemented in January 2021. However, the Healthcare Financial Management Association (HFMA) quickly responded stating the report was ‘irresponsible’ and ‘incorrect,’ instead citing the Centers for Medicare & Medicaid Services (CMS) scorecard, which last scored compliance at 70% of hospitals.
The role of revenue cycle management in price transparency
All the confusion ultimately spells one message for today’s rural health providers: Prepare revenue cycle management teams to answer patients’ questions as price transparency requirements continue to evolve.
For example, when using hospital price transparency tools, patients often don’t understand why there are cost differences for an MRI performed in the hospital versus one in a freestanding imaging center. “They’ll call the hospital and say, ‘How come this clinic can provide the MRI at such a lower rate than your hospital?’’ says Sudbrink. “Then we need to explain that we can’t price match the service because it’s more expensive to staff and operate the hospital. We’re not price gouging. There’s more than meets the eye in terms of how providers price their services.”
Patients with health insurance call hospitals more frequently—especially after receiving a bill. Sudbrink shared that patients call and say “The hospital website said it would cost one amount, and the bill I received says something different. Our staff takes the time to explain that everyone’s insurance plan is different and can even vary by employer.”
Leverage price transparency to promote patient empowerment
Sudbrink provides these three strategies to help revenue cycle management teams in rural hospitals navigate the dynamic landscape of price transparency with greater ease:
1. Encourage patients to be their own advocates. “Hospitals shouldn’t be wholly responsible for explaining healthcare costs. For example, insurance companies can identify other contracted facilities in the area so patients can compare prices more easily and get the best deal” says Sudbrink. “Consumers have a responsibility to educate themselves about their own health benefits. It’s all about patient empowerment. Urge patients to contact their insurance company at the time of scheduling and remind them that hospital price estimates may vary based on their own individual plan.”
2. Provide staff education. “Ensure your frontline teams are confident enough to walk patients through some of that raw data and answer common questions or consider partnering with an outsource vendor that has some customer service and revenue cycle management expertise,” she says.
3. Focus on the patient's financial experience. “Love it or hate it, price transparency presents rural hospitals with a unique opportunity for compassionate patient collections and patient engagement,” says Sudbrink. “This is especially important during a time when costs continue to increase across all industries. Some of these patients may need financial assistance, and it’s important to point them in the right direction. We don’t want patients to forgo the care they need because they can’t afford it.”
Looking ahead
Healthcare prices are—and will continue to be—confusing at best for the foreseeable future, says Sudbrink. However, rural healthcare providers can leverage the price transparency rule to promote patient empowerment and build trust. Learn how Inland RCM can help.