Building on a commitment to health care price transparency that spans more than a decade, the Health Care Cost Institute is excited to introduce HealthPrices.Org (formerly Guroo), a free health care price transparency tool that shows consumers the average prices for health care services in their local metropolitan area. Access to data on prices can help consumers, employers, and other purchasers of health care better understand typical rates for the most common health care services.

Transparency is a critical first step in understanding how money flows through the health care system. HealthPrices.Org was built on the belief that the price of health care should be easy to understand and accessible to everyone. It can help facilitate discussions between patients and their providers about the cost of care and allow patients to compare information on their Explanation of Benefits with real-world data. Using data from millions of actual payments from across the United States, including amounts paid to providers and fees paid to facilities, the website includes a price comparison tool that illustrates how prices for the same service vary across the country and how those prices compare to what Medicare pays.

This relaunch of HCCI's price transparency tool complements broader efforts to increase publicly-available information about the costs of health care services, including Federal Transparency in Coverage (TiC) rules. The TiC regulations require group health plans and health insurance issuers in the individual and group market to disclose in-network rates and out-of-network allowed amounts and billed charges for covered items and services. The data files created as a result of these federal rules are rich and detailed, and they include key metrics (e.g., in-network negotiated rates) that facilitate employers and other stakeholders' examination of high prices. Due to the level of detail included in these files, they are sizeable and difficult for the average consumer to download and read. Although several organizations have ingested and displayed the data in a more user-friendly format, the TiC files run the risk of providing too much detail for an average consumer to parse through. The files contain negotiated rates for every single service available, including rates for services that providers do not provide ("phantom prices"), leading to a huge amount of information to navigate. For example, one study identified more than 56 billion prices reported in what is only a subset of the plan data. 

One known challenge with the TiC data is the inability to account for health care complexities and complications that may arise during a health care encounter. Often, the contractually negotiated rates that appear in TiC files are not the same as the amount a provider or facility is reimbursed or the amount that, ultimately, will appear on a patient's bill. The discrepancy is the result of a number of factors, including procedure modifiers (i.e., increased procedural services and effort), service site of care (e.g., facility, physician's office), and diagnosis codes that affect the actual billed cost of service and may not be reflected in the negotiated rate. Additionally, the TiC files present price data at the procedure code level. Individual procedure codes are rarely billed alone. Even straightforward health care encounters, such as influenza vaccinations, typically have two billed procedure codes: one for the vaccine itself and the other for administration of the vaccine by a health care professional. Other health care services, such as x-rays, have an individual service code and often are billed with a facility fee as well as a provider fee for the clinician who reads and interprets the image results. In this case, the price of an individual x-ray procedure code would not represent the actual cost of receiving an x-ray. It is also common for ancillary services (e.g., surgical trays, anesthesia) to be billed as separate procedure codes along with another (primary) procedure. Some ancillary services may be unanticipated and difficult to predict prior to the procedure.

Health care claims data is another source of health care prices and can enhance other transparency information (e.g., the TiC files) to facilitate a meaningful and accurate picture of expected total cost of care. Though not without challenges, health care claims data can capture a more complete picture of how care is typically provided. Administrative claims data contain actual transactional details from patients seeking health care services from providers and facilities. Claims data include the allowed amount (negotiated amount) paid to the provider by the health plan, accompanying procedure codes, diagnosis codes, service dates, etc. The details and consistency of health care claims give them the advantage of capturing all services provided over a specified period of time, which allows them to reflect all fees, payments, and services provided. Taken together, datasets built on health care claims offer insights on how services are provided, which allows consumers, purchasers, and policymakers to narrow their focus to commonly used services.

By leveraging the power of health care claims data, tools like HealthPrices.org work to promote and advance transparency. HealthPrices.org provides price estimates that include all the associated and ancillary services commonly billed with a particular service. These price ranges can help consumers prepare for the costs they may encounter before they receive the service. For example, if a patient were interested in knowing the potential cost of an inpatient hip replacement without complication, they could use the tool to see the estimated price range within a specific metro area, as well as a breakdown of all the likely included costs and fees. A hip replacement often includes the hospital facility fee, along with provider fees for the replacement of the hip bone, anesthesiology, x-ray interpretation, and provider care at the hospital. The estimate also includes related care before and after the primary procedure, such as office visits, imaging procedures, and physical therapy, which are identified as commonly used services based on patterns observed in claims data. 

HealthPrices.Org compares prices for hundreds of the most commonly used health care services, including 56 of the 70 CMS Shoppable Services and 278 of the initial 500 TiC services. In this way, claims data can act as benchmark for prices and volume at national, state, and sub-state levels, and as a data resource to examine health outcomes, care quality, and other important questions.

Although data and transparency are powerful building blocks to many health-care advances, there still are important limitations. In addition to costs, factors, such as location, appointment availability, and cultural concordance affect health care access. The out-of-pocket amount that a patient ultimately pays depends on whether a person has insurance, the type of insurance they have, when in the plan year they are receiving the service, the presence of comorbidities, whether complications arise during a procedure, etc. Transparency alone is not sufficient to lower health care costs, but clear and publicly available information about health care prices is necessary to reach that goal. Prices are the main driver of rising health care spending over time and the key factor in why U.S. health care spending is so much higher than spending in other countries. Therefore, understanding prices is a vital first step toward lowering health care costs and improving affordability.