Today’s guest blogger, Robin Gelburd, responds to an article by Contributing Editor Shana Sweeney about her struggles with educating employees about the costs of out-of-network claims. Have you encouraged employees to use Fair Health’s consumer cost lookup tool? Share your thoughts in the comments. —Andrea Davis, Managing Editor

The topic of health care costs is front-page news. Calls for greater transparency in health care prices are a common refrain as the many parties in the nation’s health care system try to understand the observed variability in costs and outcomes. Such calls include the recent commentary piece by Shana Sweeney, in which she described her struggles as an employer attempting to guide her employees through the maze of out-of-network payments. I read this piece with great interest because it is for precisely these instances that the organization that I lead, FAIR Health, was created.

In 2009, then-New York State Attorney General Andrew Cuomo uncovered conflicts of interest in how out-of-network claims were being reimbursed. As a result, FAIR Health was formed to establish and maintain a new database of health care claims information that could be used to help payors develop reimbursement rates for out-of-network services. Our second charge was to develop a free online tool that patients could use to research the cost of health care services in their area and generate estimates of their out-of-pocket costs should they seek services out-of-network.

Today, FAIR Health uses its database of over 16 billion billed medical and dental services to power its Consumer Cost Lookup tool as well as numerous other data products. Ours is the largest independent database of private claims information available in the U.S. and the data we provide on health care charges and utilization are unbiased and independent.

Given the interest in making the cost of health care more transparent, FAIR Health’s experience in designing and launching its Consumer Cost Lookup tool is instructive. Our challenge was to design a tool that offers reliable information on health care costs but also provides the appropriate context for the many factors that influence both charges and reimbursement. There are many variables that influence a specific patient bill including the background and training of the rendering provider, the type of facility in which the procedure is performed, details about the patient’s health status, and specific features of that patient’s health plan. While all of these variables will impact a bill, consumers may not know enough about each variable to include that information in a cost calculation tool.

We have approached the development of our Consumer Cost Lookup tool with great care, and have refrained from adding information that would be misleading or difficult to understand without the appropriate context. We have also consulted with health literacy experts to develop language on the site that contextualizes the estimates that we offer and to explain when consumers may need to seek additional information from their physician or providing facility. For employers, like Ms. Sweeney, who want to offer guidance for employees about plan selection and out-of-network decision-making, we license our data, in part so that these professionals can combine FAIR Health’s charge data with information specific to an employee’s health plan in order to ease some of these confusions. 

Our cost estimates are based upon the rich repository of claims information that we oversee but, given our tool’s intended application to a general consumer audience, cannot incorporate patient-specific variables that might impact a bill. We nevertheless have confirmation from users that we are indeed providing them with critical building blocks to an accurate and informed estimate. In other words, the FAIR Health data may not be the "end of the discussion” for the consumer but may instead be a valuable starting point on the quest to gain clarity about anticipated costs for care. More importantly, it provides an accurate reference point and shines light on costs previously left opaque in the marketplace.

Cost transparency tools such as FAIR Health’s are critical first steps in the effort to provide clarity in health care costs to consumers, but we all have a long road ahead. We’re not alone – many organizations, including HFMA’s Price Transparency Task Force and the CMS through its recent data releases, are working to change the status quo and create an environment in which patients can accurately estimate the costs for which they will be responsible. We are heartened by the positive momentum this cause has seen and that FAIR Health is a vital part of the journey.

Robin Gelburd is President of FAIR Health, Inc., a national independent, not-for-profit corporation whose mission is to bring transparency to health care costs and health insurance information through comprehensive data products, consumer resources and research tools.

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