The journey to increased price transparency has been years in the making, with the most recent milestone being the No Surprises Act. And while progress has been made, there’s still more to be done. On the surface, the concept of price transparency can seem simple, but at its core it’s quite complex. To promote price transparency for patients, new policies need to be put in place to help protect patient privacy, standardize data collection and minimize unnecessary administrative burdens on providers.
In the fall of 2022, Centers for Medicare & Medicaid Services (CMS) published a request for information (RFI) requesting input from organizations across the healthcare ecosystem. The RFI responses would then be used to help inform rule making related to the advanced explanation of benefits (AEOB) and good faith estimate (GFE) for covered individuals. CMS received about 300 comments from healthcare systems, payers, technology vendors and associations documenting considerations and concerns for the development of the AEOB policies. We’ve been supporting price transparency stakeholders for over 15 years and submitted our perspective for consideration as well.
The responses submitted to the RFI offer a wealth of information and offer us visibility into what the market is saying about the future of AEOB. We took the time to read through stakeholder comments, so you don’t have to. Here are the top price transparency themes the market has asked CMS to consider.
The idea behind AEOB is that anytime an insured patient makes a request for a GFE or schedules an appointment, regardless of health insurance coverage, it would automatically trigger an advanced explanation of benefits from the payer. And while in theory that sounds great, making it a requirement could place added pressure and cost on organizations to remain compliant, especially smaller practices. With this in mind, many respondents pushed for CMS to think about this more situationally and have the AEOB available upon request, versus being generated automatically with each scheduled appointment. For many, this seems like a fair compromise that strikes a balance between improved member experience, increased transparency and alleviated provider-payer burden. Organizations would still need to remain compliant by preparing the AEOBs, but it would reduce resource costs by removing the “automatic” requirement.
Shopping tools and price estimators are another factor to consider. There were some respondents that felt an AEOB shouldn’t be a requirement at all. Their reasoning was that this new requirement has the potential to price out smaller health plans that have less funding and resourcing. They believe these advanced cost estimates overlap with their current online shopping tools that already provide member pricing information.
On January 1, 2023, the Transparency in Coverage regulations went into effect. Payers must offer an online shopping tool that includes out-of-pocket cost estimates and negotiated rates for 500 of the "most shoppable" services. By 2024, the expectation is that the requirement will be extended to all items and medical services covered by the payer.1
There were many comments and concerns shared related to the proposed 2024 requirement. Many respondents felt that it’s unreasonable to require every single covered item and service to be shoppable via a tool. They would prefer the requirement be more reasonable, either holding the line at 500, or allowing optional expansion based on a payer’s identified list of additional shoppable services. That would ensure the most common services are available for shopping in a consumer-friendly tool, while also alleviating unwarranted pressure off healthcare organizations.
It’s no surprise that several respondents expressed data privacy concerns. The battle over data access and stewardship continues and is a decision that shouldn’t be taken lightly. Providers expressed concerns around having to share diagnosis and service codes for scheduled appointments, raising concerns that payers could use the GFEs as de-facto prior authorization requests, and potentially deny treatment coverage.
This concern notwithstanding, the direction CMS is pushing towards is having the payer as the central hub of the insured patient’s data, inclusive of core clinical data elements. Patients often see multiple healthcare providers and that clinical data shouldn’t be siloed out in discrete provider systems. CMS believes having the data centralized with the payer at the center will make the data more accessible to the member, as well as a member's sometimes disparate care team. With the healthcare data centralized there is aspiration for improving the patient care experience.
Data use and access is one side of the coin, data standards is the other. Many respondents expressed support for the Da Vinci Patient Cost Transparency IG and investing in standard FHIR APIs, but that they would prefer to continue using the current x12 claim transaction standards. The rationale being providers use these standards today to exchange data with payers, and adoption and costs will be minimized leveraging existing standards, vs driving higher cost to implement a FHIR API. There were also concerns expressing the need to further advance and test the Da Vinci Implementation Guide to ensure it is mature enough to support real-world application of GFE-AEOB transactions.
Price transparency is an ever-evolving topic that will continue to be refined over time. We anticipate CMS will be publishing an AEOB proposed rule sometime this spring. Healthcare stakeholders need to keep an eye out for the Notice of Proposed Rulemaking (NPRM), so they understand CMS’s position and can take advantage of the comment period, prior to final rule making.
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