Mass. Healthcare Price Transparency Law Still Not a Reality

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State Healthcare Price Transparency Law Still Not a Reality for Most Massachusetts Consumers

Survey finds many specialists unaware of the law, don’t comply with requirement to provide price data within two business days 

Read news coverage of this report in The Boston Globe, WBUR, MassLivethe Boston Business Journal, WBZ 1030Becker’s Healthcare, Fox 25, and the Boston Herald Editorial Page.

BOSTON – With the exception of dentists and some ophthalmologists, many medical specialists make it very difficult for Massachusetts consumers to reap the benefits of a state law that requires medical price transparency, according to the results of a new survey published by Pioneer Institute.

“In an era of high-deductible health plans, transparency is supposed to help consumers allocate scarce healthcare dollars,” said Barbara Anthony, Pioneer Institute’s senior fellow in healthcare and the author of “Bay State specialists and Dentists Get Mixed Reviews on Price Transparency.”  “Yet the burdens of obtaining prices fall disproportionately on consumers.”

Under Massachusetts state law, healthcare providers must, upon request, provide prospective patients with the amount they are paid by an insurance carrier or, in self-pay or even some out-of-network situations, the charge for a procedure.  If providers are unable to quote a specific price, they must give an estimated maximum charge.  The law gives providers two business days to provide the requested information.

With the rise of high-deductible insurance policies, the price of healthcare services is becoming increasingly important to consumers, who must pay up to $6,500 or more in out-of-pocket costs under some policies.  A survey by the National Business Group on Health shows that in 2015, roughly 32 percent of companies across the nation intend to offer their employees only high–deductible plans.

Pioneer surveyed 96 specialists from across Massachusetts, split almost evenly among dentists, dermatologists, ophthalmologists and gastroenterologists.  Callers all requested self-pay prices to avoid the need for providers to give the amounts they are paid by various insurance providers for the same service.

Dentists proved to be the most transparent when it comes to prices.  Practices were asked about the price for a teeth cleaning and examination.  Prices ranged from $57 to $245, with most in the $150-$200 range.  It’s likely that dentists were the most forthcoming with price information because many dental patients are either self-pay or have coverage that provides limited benefits.

Dermatology practices were asked the price of a routine exam and removal of a wart.  Office staff were not well informed about the law and didn’t have systems in place to provide prospective patients with price information.

When price information was obtained, it often came in wide bands such as from $85 to nearly $400.  Office staff reported that the price increases if the doctor finds something, even if no additional treatment is obtained.

Ophthalmology practices were asked about the price of a routine eye exam to update a prescription for eyeglasses.  Staff in just nine of 23 offices contacted knew about the law.

Prices ranged from $80 in Chelmsford to $327 in Wellesley, with most in the $100-$275 range.  When told that the prospective patient would pay for the service themselves, the price at one practice rose from $140 to $327.

Gastroenterology practices were asked for the price of a “routine screening” colonoscopy with no removal or biopsy of polyps.  This proved to be the most complex request because the procedure requires at least three fees: the gastroenterologist’s, the anesthesiologist’s and the hospital or clinic facility fee.

Twelve of the 25 practices contacted required the callers to get in touch with the anesthesiology practice and the facility for their separate fees, which resulted in response times of between three and ten business days.  However, thirteen gastroenterologists provided all three fees within the two business days the state law allows and did not require callers to obtain such fees on their own.

Many doctors, facilities and anesthesiology services required the consumer to provide a “current procedural terminology code” to get a price estimate despite its not being required under state law. When all three fees were included, the overall routine colonoscopy fee ranged from around $1,300 to $10,000.

“Given the broad price ranges our surveys found for all types of services, it is essential that consumers be able to obtain reliable price information about healthcare procedures so that they can obtain the best value among competing healthcare providers,” said Pioneer Institute Executive Director Jim Stergios.

Anthony, who was assisted by Scott Haller, recommends that medical practices create transparent price lists for various procedures.  She also calls for the establishment of protocols for relaying prices to prospective patients.  Such protocols would require practices to educate their staffs about and provide them with training on the state transparency law.   Further, Anthony urges that if there are ambiguities or deficiencies with the existing state law, that all stakeholders, including government and the healthcare professions, come together to provide guidance to improve price transparency in Massachusetts.

About the Authors

Barbara Anthony, lawyer, economist, and public policy expert, is a Senior Fellow in Healthcare at Pioneer Institute focusing on healthcare price and quality transparency. She is also a Senior Fellow at the Harvard Kennedy School’s Center for Business and Government where she leads seminars and writes about Massachusetts healthcare cost containment efforts. She served as Massachusetts Undersecretary of the Office of Consumer Affairs and Business Regulation from 2009 to 2015 and has worked at the intersection of federal and state commercial regulation and the business community for many years. Among other positions, Anthony served as the Director of the Northeast Regional Office of the Federal Trade Commission in Manhattan, and was a top deputy to the Massachusetts Attorney General. She began her career as an Antitrust Trial Attorney at the U.S. Justice Department in Washington, D.C. Anthony is a well-known consumer advocate and regularly appears as a media commentator on consumer protection and business regulation issues.

Scott Haller is a senior at Northeastern University in Boston where he is pursuing a degree in Political Science. Scott is currently working at Pioneer Institute through Northeastern’s Co-op Program, focusing on research and policy analysis. Prior to that, he worked at the Massachusetts Office of the Inspector General.

About Pioneer

Pioneer Institute is an independent, non-partisan, privately funded research organization that seeks to improve the quality of life in Massachusetts through civic discourse and intellectually rigorous, data-driven public policy solutions based on free market principles, individual liberty and responsibility, and the ideal of effective, limited and accountable government.