18 Aug Saving Money on Health Care Through Price Transparency
Many employers and employees have not known which clinics charge more than others, because previously, there had not been health care price transparency. This has changed in Minnesota.
With an increasing number of employees owning high deductible health plans (HDHPs), price is becoming more sought after than it has over the last 50 years. And not knowing the price is increasingly frustrating and needlessly adds cost and increases premiums.
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Until now, employers and employees have not been told about the new Minnesota law that requires clinics to post their prices in their waiting rooms and on their websites. This requirement started on July 1, 2019.
Why you might be hearing this for the first time is simple – they don’t want you to know the price of care until after you receive it. This is why most employers and employees do not know this information is at their fingertips.
The law (MN Statute 62J.812) requires medical clinics to publicly display the prices of their top 25 most common procedures and their top 10 preventive procedures. These prices must show the clinic’s billed rate, average amount insurance pays, the amount Medicare and the amount Medicaid pays.
It is easy to convert the clinic’s top 25 prices to a single price point to allow you to shop for health care based on price. Using this one number, you can pre-determine the price that insurance companies have negotiated with each clinic. This one price is called the Medicare-Percent Disclosure.
For example, if you walk into a Park Nicollet Primary Care clinic, you will see a chart on the wall that shows their top 25 prices. From this, you can see that when Medicare pays the clinic $100 for a procedure, your insurance will pay, on average, $261 for the same procedure. Now walk into North Memorial’s clinic and you will see that your insurance company will pay $224 for that same procedure.
In general, by comparing the clinics’ prices in any area, you will find that the larger the health system, the higher the price. You might decide that to save 25 percent or more, you would be willing to use a less costly clinic 30-50 miles away.
Dattilo Consulting, Inc. published a manual all about price transparency. It contains a chart that shows the price ranges of 23 different Minnesota health system clinics.