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Price Transparency Tools: 3 Ways to Save Money, Time and Lives

By Tracey Lewis | May 8, 2017

Facing an unprecedented and ever-changing health care landscape, the labor union fund and its members face a tough terrain of holding down costs.

But for the fund, the use of price transparency tools to harness insurance costs while improving member health outcomes may help navigate those shifting grounds. According to the Robert Wood Johnson Foundation's research in "How Price Transparency Can Control the Cost of Health Care," health care spending is expected to reach 20 percent of gross domestic product if current trends remain steady. Yet, by empowering members to research accurate cost data using pricing apps or embedded online tools, you can increase cost efficiencies and improve health care outcomes.

Members can make value-driven decisions when they're able to compare costs among providers and health care facilities. The fund can also support those members further by providing tools they can use in the decision process. Here are three ways pricing tools can cut costs and improve member engagement:

1. Pricing Transparency Provides Benefits to Members

Rising health care costs are causing members to be more price sensitive and seek information to weigh their health care decisions. As Drew Altman, CEO and president of the Kaiser Family Foundation noted the greatest hurdle in consumer research is incomplete information due to the opaque pricing structure offered by providers. The fund is ideally situated to persuade members to assess the value of health care services through the use of pricing tools, as reported by the Healthcare Financial Management Association.

According to the National Business Group on Health, an increasing trend is for organizations to provide members with online or app-based pricing tools, which can also alleviate those research barriers. Nearly three out of four organizations plan on giving people access to self-directed pricing tools in the future.

2. Transparency Tools Help Reduce Health Care Costs

Pricing tools help the fund encourage members to make cost-effective choices with features such as:

  • Prescription drug cost estimators;
  • Deductible summaries for medical services; and
  • Treatment pricing information.

An online pricing transparency tool can provide the necessary information on common procedures such as CT or MRI scans to help members make choices best for their health, and wallet. Used in conjunction with other benefits, the tool can help members save money in out-of-pocket expenses, while benefits administrators can keep health coverage costs under control.

Armed with an accurate picture of options and costs, members can take an active role in their health care.

3. Informed Decisions Can Save Lives

Benefits administrators must not mistake merely providing tools as a means of creating highly informed and engaged members. According to Deloitte's 2016 Consumer Priorities in Health Care Survey, investment in digital tools doesn't mean people understand what tools are available or how to use them in medical decision-making. Therefore, it's vital that benefits administrators strive to improve member engagement, which leads to managing costs more efficiently, improving member outcomes and ensuring a less bumpy reimbursement experience.

In a survey by Consumer Medical, respondents expressed trepidation in navigating the health care system without more detailed guidance from benefits administrators. Without those tools and expert guidance, almost 50 percent of survey respondents relied on internet searches for information about their physician, compared to the 18 percent who seek information directly from their plan.

The fund can encourage members who invest time researching and using pricing tools by incentivizing those efforts, such as a financial inducement to meet with a benefits expert before an expensive surgery. It's clear that the fund will benefit from investing in tools and member education through cost savings and improved member health outcomes.

Tracey Lewis, journalist and author focuses primarily on B2B health care, financial services and other internal corporate communications. Author of a best-selling pop-culture book published by Random House Books,  and a trained oral historian, Tracey also enjoys delving into music, arts and film content. Skilled in SEO optimization and digital storytelling, she knows how to collaborate with communications, policy, research, legal and designer teams to create and execute cohesive content strategies.

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