The divisive midterm elections are finally over, and with the resulting divided Congress, only bipartisan-backed legislation has a chance of becoming law. The new Congress can come together and win a quick bipartisan victory by tackling one of the most pressing issues facing all Americans: the health care cost crisis.
According to a recent Gallup poll, nearly 40% of Americans are willing to change their vote for the candidate with the best solutions to the country’s health problem. In other words, many people are willing to put effective health care policy above the preference of political parties.
The healthcare solution that receives the broadest bipartisan support is healthcare pricing transparency, which is supported by a supermajority of nearly 90% of Americans. By codifying and strengthening a federal hospital price transparency rule into law, Congress can enable Americans to significantly reduce their health care costs through choice and competition.
There is an urgent need to tackle the spiraling costs of health care. Recently, the Ministry of Labor revealed that the cost of health insurance increased by 20.6% compared to the previous year, almost three times the rate of overall inflation. Last month, the Kaiser Family Foundation announced that the average annual premium for employer-sponsored family health care reached $22,463 in 2022, or nearly a third of the nation’s median household income.
Experts predict that costs will rise even faster next year. Many health plans, including the one covering New Jersey civil servants, have decreed rate increases of more than 20% for 2023.
Due to skyrocketing health care costs, 100 million Americans are in medical debt and nearly two-thirds avoid care each year for fear of financial ruin. Rapidly rising employer health insurance costs are attacking American businesses and cannibalizing funds that could otherwise be used for wage increases to help workers cope with historic inflation.
Failure to act in the face of this calamity is evidence of a form of healthcare Stockholm syndrome.
Simply increasing the number of Americans with health insurance means little if consumers can’t afford premiums or care. On the other hand, price transparency can actually bend the cost curve.
Real Initial Prices allow healthcare consumers, including employers and unions, to spot wild and well-documented price swings for the same care, even at the same hospital. For example, in a California hospital, the price of a caesarean section ranges from $6,200 to $60,600. A recent study published in the journal Radiology finds that CT scans can range from $134 to $4,065 at the same hospital.
Armed with real prices, consumers can avoid skyrocketing hospital prices in favor of quality, lower-cost alternatives for more than 90% of non-emergency healthcare expenditures. When prices are known in advance, no consumer will tolerate paying 10 times more than the person in the bed next to him for the same care.
Employers and unions can use the resulting savings to reduce premiums and raise wages. Consider the SEIU 32BJ union, which represents approximately 200,000 building services workers in the Northeast. It recently handed its members their biggest pay rises in history and $3,000 bonuses after analyzing its claims data and removing price-gouging New York-Presbyterian Hospital from its plan. .
On January 1, 2021, a federal hospital price transparency rule went into effect, requiring hospitals to publish their discounted cash prices and all health insurance rates. This information may make it easier for healthcare consumers to follow the lead of SEIU 32BJ and other innovative employers.
Unfortunately, the rule has been marred by widespread non-compliance by hospitals. A recent study by PatientRightsAdvocate.org reveals that only 16% of hospitals are fully compliant.
Congress can stimulate compliance and improve the rule by codifying it into law. This can make the rule more efficient for consumers by requiring hospitals to follow clear data disclosure standards to enable third-party technology innovators to aggregate prices into easy-to-use web applications in the same way as travel websites. aggregate airfares on sites like Kayak or Expedia.
Lawmakers can further improve the rule by closing a loophole that allows hospitals to display estimates instead of actual prices. Cost estimates are false transparency. Only actual prices allow consumers to compare and save substantially knowing that the final bill will match the price quoted.
The new Congress can score a quick victory by reversing runaway health care costs through robust price transparency, a solution backed by an overwhelming bipartisan supermajority. The divided Congress should make health care its top priority.
Cynthia A. Fisher is Founder and President of PatientRightsAdvocate.organd founder and former CEO of ViaCord Inc. She wrote this column for The Dallas Morning News.
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