“If the state had followed Folwell’s recommendation to adopt Reference Based Pricing a few years back they wouldn’t be facing a rate increase and a +$1 billion health plan deficit next year. Instead, the state changed the logo on their health insurance card.“ – Bill Rusteberg
Watkins said some hospitals charge about 800 percent above Medicare reimbursement rates — or nine times more — but those prices are hidden under a trade secrets exception to the public records law. Allowing the public to see how much providers are charging for care would drive prices down, she said.
“All of the hospitals claim to be poor in the halls of the legislature,” Watkins said. “Once the public knows who we’re paying 800 percent to, and we can tie that to CEO salaries in the millions, then we’ll have something to work with.”
A few other states, like Montana, are trying to rein in costs with price caps or a strategy called reference-based pricing, Zachary said. That’s when a health plan sets fixed prices for each health care service instead of negotiating with providers.
Former state treasurer Dale Folwell pushed for a similar approach in North Carolina with his Clear Pricing Project, but he couldn’t get legislative support to make it mandatory, leaving it as an optional program.
