Regulations Are a Driving Force Behind Price Transparency and Data Interoperability
The federal government is the largest healthcare buyer and one of the primary sources putting pressure on the industry to change, having implemented key initiatives to promote transparency and enhance data exchange in the industry. These regulations, such as the No Surprises Act, Transparency in Coverage rules, the 21st Century Cures Act, and the Promoting Interoperability Program, aim to empower consumers, improve care coordination, and foster innovation.
With all the conversation around these topics and regulations, many payers may wonder how to turn these challenges and roadblocks into opportunities and ensure they’re taking the right steps to meet increasing demands of their fiduciary duty. Amid changing regulatory pressures, the current approach to price transparency and interoperability in healthcare is increasingly unsustainable, but by changing our approach, we can unlock new opportunities, innovations, and shape a more patient-centric and connected future.
The Role of Price Transparency and Interoperability
Bipartisan efforts have led to the implementation of regulations such as the No Surprises Act and Transparency in Coverage rules. As a result, payers are expected to provide clear and accessible information about the cost of healthcare services, including prices for treatments, procedures, and medications. Additionally, payers must disclose negotiated rates with healthcare providers, allowing individuals to make informed decisions about their care based on cost. By promoting price transparency, these regulations aim to create a more patient-centered and cost-conscious healthcare system. With the availability of more insight than ever before into the cost of care, there is a growing expectation that health plans and plan sponsors take advantage of this data to ensure they’re meeting their fiduciary duty with respect to the spending of plan assets.
In addition to price transparency, the U.S. government has placed a strong emphasis on healthcare data interoperability. Stringent requirements, including the 21st Century Cures Act and the Promoting Interoperability Program, mandate the use of standardized data formats and APIs, enabling secure and efficient sharing of patient data between payers, providers, and other relevant stakeholders. Furthermore, Payers are expected to adopt interoperable systems and technologies that facilitate the seamless exchange of patient health information across different healthcare entities. These interoperability measures enhance care coordination, improve patient outcomes, and stimulate innovation in the healthcare industry.
While all important goals, these expectations compound in mounting pressures for payers:
Compliance Burden: Payer organizations face the challenge of ensuring they meet the regulatory requirements for price transparency and interoperability, which often involve substantial changes to their systems, processes, and data management practices.
Data Management and Integration: Achieving interoperability necessitates the integration of diverse data sources, including electronic health records (EHRs) and claims data. Payers must overcome technical and operational hurdles to establish seamless data exchange channels.
Information Accuracy and Quality: Payers need to ensure that the price and quality of information they provide to consumers is accurate, up-to-date, and reliable. This requires robust data governance and validation processes to maintain data integrity.
For payers in particular, there is a lot of pressure to get it right. Potential missteps can involve increases in administrative costs/burdens, data governance challenges, legal action/fines for failure to comply properly, and dealing with required process/organizational change.
When it comes to tackling price transparency and interoperability however, there are many roadblocks that payers will inevitably face.
Roadblocks to Price Transparency and Interoperability in Healthcare
Decades of confusing and opaque pricing in the healthcare industry have contributed to a significant challenge: out of control Medical Loss Ratios (MLRs). The consequences of this issue are far-reaching, with US healthcare spending exceeding a staggering $4 trillion in 2020. Projections indicate that health spending will likely continue to outpace economic growth by 2030. Recognizing the urgency of the situation, regulatory interventions have been introduced, exerting increased pressure on payer organizations to modernize their systems and evolve their processes in order to comply.
The existing systems employed by payer organizations are often outdated and monolithic, unable to adapt quickly to changing regulatory requirements. Consequently, their processes have become tangled webs of workarounds and manual labor. Finding solutions to these complex challenges is no easy feat, leaving ample opportunities for vendors who can address specific portions of a payer’s needs. This situation has led to a proliferation of vendors, with over 11,000 digital health vendors currently operating in the market.
Additionally, payers have become accustomed to addressing problems by carving out separate pieces of their business. This approach stems from the difficulty, time, and cost associated with altering or overhauling their core processes and systems. However, this practice exacerbates the issue of connectivity and interoperability. As more connections are added that lack interoperability, an ocean of unusable data emerges. To remain competitive and meet the demands of new regulatory requirements, payers must prioritize making their systems more interoperable and their data more usable.
Setting Payers Up for Success with Intelligent Health Markets
As we navigate the ever-evolving regulatory landscape in healthcare, it becomes evident that continuing on the same trajectory won’t be sustainable for payers. To provide the transparency expected and overcome the plethora of obstacles impeding the ability to identify and capitalize on opportunities, evaluate performance metrics, and optimize efficiency and cost savings, payers need an Intelligent Health Market. An Intelligent Health Market, like the ones created by the MacroHealth Intelligent Exchange™ platform, is a solution that leverages the power of data and a marketplace approach so you can better meet compliance requirements and gain a competitive advantage.
With easy access to internal and external market data, coupled with industry-standard interoperability, payers can streamline operations, enhance transparency, and foster collaboration among stakeholders to transform healthcare access, reduce care and administration costs, and ultimately enhance the quality of care.
Contact us to schedule a demo today.