Are new APIs and integration services up to the challenge?
As I’ve noticed throughout my career as an analyst, new technologies and approaches generally get used in new projects.
Our latest Market Trends Report, Integration Infrastructure: Building 21st Century Healthcare IT, provides a comprehensive view of the variety of new and different approaches to development and integration that will harness data across organizations and applications in the healthcare ecosystem.
Where can these new approaches demonstrate their value?
The most important greenfield opportunity in healthcare over the next few years could very well be price transparency. New, federally mandated pricing disclosures from both providers and payers are coming in the next few years. Add to that continued escalation in DC around the issue, with the House Committee on Energy and Commerce issuing a letter (PDF) to HHS Secretary Becerra “urging [him] to ensure that the HHS conducts vigorous oversight and enforces full compliance with the final rule.” Expanded, useful availability of this pricing data could put newly introduced API-based technologies to the test with sudden increased usage.
Very Messy Data
In the 90 days since providers were required to publicly post pricing data on their websites, many have done so. While overall compliance is hard to measure, the data that is available is skimpy, misleading, and baffling. Current disclosures may meet the letter of the regulation; however, organizations have put up hurdles to access such information, and with civil penalties a mere $300/day for non-compliance, there’s currently minimal incentive for them to care. Finding the pricing data on a provider’s website can be a challenge, and even when located, the data can be difficult to review and digest. We are also seeing a developing narrative around certain sites directly discouraging anyone from finding the data in the first place, let alone deriving useful information from it once discovered.
(Kudos to CMS regulators for taking swift action and banning the use of the code that was hiding this data from consumers, though TBD on the actual impact of their action).
While the current nature of these disclosures are of little or no value to a patient, other providers and payers will find some gems here. It is possible to see some negotiated rates between the provider and all of its contracted health plans. Providers have been cryptic about what the price relates to in many cases. To be fair, they offer some prices by CPT or DRG. All too often, no price is given, but the provider informs us the item or service in question is bundled with other services. No patient could compare the disclosed prices from one provider to another provider because it is unclear if they both are talking about the same item or service. But other providers and health plans will closely scrutinize these prices.
The provider pricing disclosures will be followed in the next few years with similar payer and health plan disclosures. Starting in January 2022, health plans will have to publish in-network negotiated rates with their network providers and historical payments of allowed amounts to out-of-network providers. From there, the required disclosures ramp up over 2-3 years.
The Dream of Shopping for Healthcare
The availability of all this new data dovetails nicely with the need to make dealing with the healthcare system a more consumer friendly experience. For that to happen, the quality of the disclosures will have to improve. For example, consistency of expression from organization to organization would streamline the process of gathering pricing data, and it would be helpful if the data were API-accessible; both of these improvements are sure to happen. This will likely create a ready market for developers to build the next set of consumer apps, similar to the model GoodRx has implemented for drug pricing.
While the healthcare system has many confusing shopping tools, the data in these disclosures—coupled with the new and evolving integration capabilities coming into the market—will deliver genuinely accurate and reliable “shoppable services” tools to patients.
Video transcript below for the SEO bots:
Brian Murphy: [00:00:00] Welcome back to the channel. I’m Brian Murphy, an analyst here at Chilmark. I am required to ask you to click “like” if you enjoy this content, to click subscribe if you want to see more of it, and click that bell if you want to be notified the instant new content is available. We have a brand new Market Trends Report coming to you on the topic of integration infrastructure. There’s a blog right now on our website that I highly recommend, and it talks about some of the things that people are going to be able to do with the tools and services that are the subject of this Market Trends Report.
[00:00:43] Rather than bore you with the specifics of the report today, I want to talk a little bit about price transparency. This topic has been controversial over the last few years, but there has been some progress. Beginning last year, hospitals had to post their charge master prices on their website. Not terribly useful information. Starting January of this year, they had to post a list of shoppable services, including their negotiated rates, with all the different plans that they’re involved with.
[00:01:13] Popping up next to me is an example of one of these disclosures. And as you can see, not terribly useful to the average patient. As you can see it’s written in XML, probably the most popular human readable programming language ever invented. So, completely worthless to the average patient. However, a lot of people are interested in this data, and a lot of people are going to make use of it, and they’re going to be using a lot of the tools and techniques that we describe in the market trends report.
[00:01:42] So other providers and other health plans will be fascinated by this kind of information. They will begin to understand the different reimbursement that other providers are getting from the same exact clients. Conversely, the plans are going to be able to understand what other plans are paying providers in their area. In other words, there will be downstream users of this data, and by hook or by crook, someone’s going to figure out a way to make this useful to patients.
[00:02:09] Next shoe to drop on this particular topic is, payers are going to have to start disclosing what they’re paying to providers. So it’s going to be interesting to see come next year if these prices line up. In other words, if what payers are saying about what they’re getting from providers matches up with what payers are saying they pay to providers, the whole idea of price transparency is to encourage an environment where prices can become more competitive.
[00:02:39] So we can only hope that it drives prices down if we’ve managed to pique your interest in this topic. We’re planning a webinar based on this Market Trends Report. And again, in the description, there’s a link to indicate your interest if you’re new or lurking. Welcome to Chilmark Family Videos. If you enjoyed this video, I’d appreciate it if you give it the old thumbs up. And if you have any questions, please, indicate them below in the comments and we will get right back to you.