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How Hospitals Approach Price Transparency?
Article Summary
The article How hospitals approach price transparency: the issue of price transparency has become more prevalent in health care recently, but hospitals may have different views of the concept depending on their relative charge levels by Houk and Cleverley (2014) has addressed the problem of price transparency in hospitals around the United States. The authors of the article have explained that the rationale for their interest in the given subject is based on the growing concerns among the citizens regarding exorbitant hospital bills they have on a more frequent basis.
Houk and Cleverley (2014) have conducted a research study with the help of a survey to understand how financial directors in different cities around the United States formulate the pricing policy of their hospitals. Seventy eight financial representatives from 185 hospitals were surveyed to obtain the data for analysis. The main findings the researchers have made with the help of surveying the specialists in finance activity in various hospitals around the country were the following:
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defensibility is the same important as transparency;
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hospitals concerned with defensible prices have lower charges ;
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hospitals communicate charges primarily upon request;
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an eye toward price transparency during rate setting correlates with lower charges ;
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the representatives of the hospitals with high prices believe that transparency will make them lower the prices;
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high-charge hospitals are concerned with the financial impact of lowering charges through transparency initiatives ;
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accommodation of new pricing policies in the industry requires allowing commercial players into the market;
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price transparency facilitation requires sufficient time (Houk & Cleverley, 2014, p. 56).
To increase the pricing transparency in the health care industry, charge modeling could be conducted to demonstrate to the payer the proposed reductions, amended contract terms, and resulting payment neutrality as far as the researchers have concluded based on the results of their study (Houk & Cleverley, 2014, p. 61). However, pricing transparency upgrade is not the only change that consumers would like to see as regards to the policy of pricing plan formation in hospitals around the country. Another significant area of customer concern as far as the study has found is making the pricing information relevant to the public (Houk & Cleverley, 2014, p. 61).
According to Houk and Cleverley (2014), this communications challenge involves converting the clinical terminology detailed in a hospitals chargemaster into common and meaningful descriptions that laypeople can comprehend (p. 61).
Summing up the results of the study, the authors of the article have stated that American health care as an industry is facing a complex challenge to make health care prices more explainable and reasonable. There are many reasons to do so. The most important concern is the public health deterioration due to the unaffordable medical services prices.
Personal Reflections
Reflecting on the subject addressed in the article under consideration, the authors have addressed the burning issue in todays health care industry. From what I have seen in my daily professional practice, patients are highly concerned due to the nontransparent pricing policy in the majority of health care offices. They do not only want to have the detailed pricing information before they make their consumer decisions but also want to know why the price is this size and what value they may have choosing any specific service.
Price transparency appears an issue of interest both among the consumers and health care professionals. From my professional experience, consumer satisfaction from using health care services in a particular hospital directly depends on the price transparency policy in this institution. It is therefore very important to learn how to develop the balanced and well-justified by the economic variables and accompanying factors pricing policy.
The skill of building transparent and well-justified pricing plan is very important for every professional in the area of health care finance management. I have been thinking about the mechanisms of pricing development in private practices for a long time. Therefore, finding this article helped me satisfy my curiosity and obtain the information I was looking for some time.
The Value for Application in Practice
The value of the article under consideration for application in practice in a business situation I have experienced in my work is significant. In my professional activity, I have faced the problem of complexity of explaining pricing transparency principles implemented in my hospital to the clients. Reflecting on the situations that I have experienced from the point of view of the given article, I would report this problem along with the evidence-based approach suggested in this article to my team leader.
The article recommends offering the consumers the readily available pricing information on health care services since such transparency helps patients choose the care providers that offer the desired value at the reasonable price (Houk & Cleverley, 2014). Patients need not only the pricing information but price justification as well because they want to make their conclusion of whether the offered value corresponds to the pricing plan (Houk & Cleverley, 2014).
Reference
Houk, S., & Cleverley, J. O. (2014). How hospitals approach price transparency: the issue of price transparency has become more prevalent in health care recently, but hospitals may have different views of the concept depending on their relative charge levels. Healthcare Financial Management, 68(9), 56-63.
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