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Giving patients access to a searchable pricing website to research costs for services resulted in a payment reduction for lab tests, advanced imaging services, and office visits, according to Christopher Whaley of Castlight Health and the University of California, Berkeley, and his colleagues. The report was published Oct. 21 in JAMA.
The reductions translated to a dollar difference of $3.45, $124.74, and $1.18, respectively.
Mr. Whaley and his colleagues looked at health care claims data on 502,949 individuals and their dependents from 253,757 households and 18 employers. Participants had access to a “price transparency platform,” Castlight Health, from 2010 to 2013, and could choose from a variety of insurance plans, including high-deductible, limited-network, and preferred-provider organization plans. The platform was accessible via web, mobile, and telephone, and employees were shown personalized out-of-pocket costs based on their plans when they searched for a medical intervention or test (JAMA 2014;312:1670-6 [doi:10.1001/jama.2014.13373]).
The researchers examined searches for laboratory tests, advanced imaging (MRI and CT scans), and office visits. Inpatient and emergency department claims were excluded because of the limited ability to shop for these services.
For each of the types of services studied, the investigators used claims data submitted by all 18 employers for a “pre-period” of up to 2 years before making the transparency platform available, and then for all subsequent periods.
Participants who had at least one claim for a service within 14 days of performing a search were classified as “searchers.” Those who did not perform a search before receiving a claim were “nonsearchers.”
In total, 304,247 individuals from 195,401 households received laboratory services, 37,384 individuals from 34,245 households received imaging services, and 446,290 individuals from 236,942 households visited a clinician.
Claims paid were lower for those who searched 14 days before receiving services. Adjusted payments were 14% lower for laboratory tests, 13% lower for imaging, and 1% lower for office visits.
Patients may have changed providers despite the “seemingly modest” savings because the less expensive physicians could have been of higher quality, or more convenient for the patient, Mr. Whaley and his colleagues noted. In addition, “forward-looking patients thought that savings per laboratory test would accumulate over time. Some patients, especially those with chronic conditions, need periodic laboratory tests or other medical services,” justifying the change.
The study was limited in a few ways. First, since searching is not randomly assigned, there may be unobserved factors that explain payment differences between searchers and nonsearchers. Second, it is unclear whether the findings can be generalized to patients who chose not to search, and further study is needed to investigate why some chose not to use the transparency platform, and why some who searched did not end up pursuing health services. Lastly, the study was not designed to evaluate quality of care, convenience, or other factors unrelated to price that may contribute to patients’ decision making.
All of the investigators reported relationships with Castlight Health. The study was supported by a grant from the National Institutes of Health.
The findings reported by Whaley and associates “indicate that price transparency works as economists would expect it would,” Dr. Uwe E. Reinhardt wrote in an editorial accompanying the study (JAMA 2014;312:1642-3 [doi:10.1001/jama.2014.14276]).
However, transparency in consumer health care costs is only useful while the market is competitive. “Greater transparency about prices and quality in health care are not helpful if the relevant market for health care is monopolized,” Dr. Reinhardt said.
This is an important yet often overlooked point, said Dr. Reinhardt, and one that providers and patients should keep in mind so they can best compare options and benefit from greater transparency in health care pricing.
Uwe E. Reinhardt, Ph.D, is professor of political economy at Princeton University.
The findings reported by Whaley and associates “indicate that price transparency works as economists would expect it would,” Dr. Uwe E. Reinhardt wrote in an editorial accompanying the study (JAMA 2014;312:1642-3 [doi:10.1001/jama.2014.14276]).
However, transparency in consumer health care costs is only useful while the market is competitive. “Greater transparency about prices and quality in health care are not helpful if the relevant market for health care is monopolized,” Dr. Reinhardt said.
This is an important yet often overlooked point, said Dr. Reinhardt, and one that providers and patients should keep in mind so they can best compare options and benefit from greater transparency in health care pricing.
Uwe E. Reinhardt, Ph.D, is professor of political economy at Princeton University.
The findings reported by Whaley and associates “indicate that price transparency works as economists would expect it would,” Dr. Uwe E. Reinhardt wrote in an editorial accompanying the study (JAMA 2014;312:1642-3 [doi:10.1001/jama.2014.14276]).
However, transparency in consumer health care costs is only useful while the market is competitive. “Greater transparency about prices and quality in health care are not helpful if the relevant market for health care is monopolized,” Dr. Reinhardt said.
This is an important yet often overlooked point, said Dr. Reinhardt, and one that providers and patients should keep in mind so they can best compare options and benefit from greater transparency in health care pricing.
Uwe E. Reinhardt, Ph.D, is professor of political economy at Princeton University.
Giving patients access to a searchable pricing website to research costs for services resulted in a payment reduction for lab tests, advanced imaging services, and office visits, according to Christopher Whaley of Castlight Health and the University of California, Berkeley, and his colleagues. The report was published Oct. 21 in JAMA.
The reductions translated to a dollar difference of $3.45, $124.74, and $1.18, respectively.
Mr. Whaley and his colleagues looked at health care claims data on 502,949 individuals and their dependents from 253,757 households and 18 employers. Participants had access to a “price transparency platform,” Castlight Health, from 2010 to 2013, and could choose from a variety of insurance plans, including high-deductible, limited-network, and preferred-provider organization plans. The platform was accessible via web, mobile, and telephone, and employees were shown personalized out-of-pocket costs based on their plans when they searched for a medical intervention or test (JAMA 2014;312:1670-6 [doi:10.1001/jama.2014.13373]).
The researchers examined searches for laboratory tests, advanced imaging (MRI and CT scans), and office visits. Inpatient and emergency department claims were excluded because of the limited ability to shop for these services.
For each of the types of services studied, the investigators used claims data submitted by all 18 employers for a “pre-period” of up to 2 years before making the transparency platform available, and then for all subsequent periods.
Participants who had at least one claim for a service within 14 days of performing a search were classified as “searchers.” Those who did not perform a search before receiving a claim were “nonsearchers.”
In total, 304,247 individuals from 195,401 households received laboratory services, 37,384 individuals from 34,245 households received imaging services, and 446,290 individuals from 236,942 households visited a clinician.
Claims paid were lower for those who searched 14 days before receiving services. Adjusted payments were 14% lower for laboratory tests, 13% lower for imaging, and 1% lower for office visits.
Patients may have changed providers despite the “seemingly modest” savings because the less expensive physicians could have been of higher quality, or more convenient for the patient, Mr. Whaley and his colleagues noted. In addition, “forward-looking patients thought that savings per laboratory test would accumulate over time. Some patients, especially those with chronic conditions, need periodic laboratory tests or other medical services,” justifying the change.
The study was limited in a few ways. First, since searching is not randomly assigned, there may be unobserved factors that explain payment differences between searchers and nonsearchers. Second, it is unclear whether the findings can be generalized to patients who chose not to search, and further study is needed to investigate why some chose not to use the transparency platform, and why some who searched did not end up pursuing health services. Lastly, the study was not designed to evaluate quality of care, convenience, or other factors unrelated to price that may contribute to patients’ decision making.
All of the investigators reported relationships with Castlight Health. The study was supported by a grant from the National Institutes of Health.
Giving patients access to a searchable pricing website to research costs for services resulted in a payment reduction for lab tests, advanced imaging services, and office visits, according to Christopher Whaley of Castlight Health and the University of California, Berkeley, and his colleagues. The report was published Oct. 21 in JAMA.
The reductions translated to a dollar difference of $3.45, $124.74, and $1.18, respectively.
Mr. Whaley and his colleagues looked at health care claims data on 502,949 individuals and their dependents from 253,757 households and 18 employers. Participants had access to a “price transparency platform,” Castlight Health, from 2010 to 2013, and could choose from a variety of insurance plans, including high-deductible, limited-network, and preferred-provider organization plans. The platform was accessible via web, mobile, and telephone, and employees were shown personalized out-of-pocket costs based on their plans when they searched for a medical intervention or test (JAMA 2014;312:1670-6 [doi:10.1001/jama.2014.13373]).
The researchers examined searches for laboratory tests, advanced imaging (MRI and CT scans), and office visits. Inpatient and emergency department claims were excluded because of the limited ability to shop for these services.
For each of the types of services studied, the investigators used claims data submitted by all 18 employers for a “pre-period” of up to 2 years before making the transparency platform available, and then for all subsequent periods.
Participants who had at least one claim for a service within 14 days of performing a search were classified as “searchers.” Those who did not perform a search before receiving a claim were “nonsearchers.”
In total, 304,247 individuals from 195,401 households received laboratory services, 37,384 individuals from 34,245 households received imaging services, and 446,290 individuals from 236,942 households visited a clinician.
Claims paid were lower for those who searched 14 days before receiving services. Adjusted payments were 14% lower for laboratory tests, 13% lower for imaging, and 1% lower for office visits.
Patients may have changed providers despite the “seemingly modest” savings because the less expensive physicians could have been of higher quality, or more convenient for the patient, Mr. Whaley and his colleagues noted. In addition, “forward-looking patients thought that savings per laboratory test would accumulate over time. Some patients, especially those with chronic conditions, need periodic laboratory tests or other medical services,” justifying the change.
The study was limited in a few ways. First, since searching is not randomly assigned, there may be unobserved factors that explain payment differences between searchers and nonsearchers. Second, it is unclear whether the findings can be generalized to patients who chose not to search, and further study is needed to investigate why some chose not to use the transparency platform, and why some who searched did not end up pursuing health services. Lastly, the study was not designed to evaluate quality of care, convenience, or other factors unrelated to price that may contribute to patients’ decision making.
All of the investigators reported relationships with Castlight Health. The study was supported by a grant from the National Institutes of Health.
FROM JAMA
Key clinical point: Patient access to health provider costs may save money.
Major finding: Adjusted payments were 14% lower for laboratory tests, 13% lower for imaging, and 1% lower for office visits.
Data source: An analysis of 502,949 individuals from 253,757 households, and their dependents, who had access to a “price transparency platform” from 2010 to 2013.
Disclosures: All of the investigators reported relationships with Castlight Health. The study was supported by a grant from the National Institutes of Health.