No More Secrets, No More Gag Clauses

Psst, Godfather! The Cat’s Outa The Bag!”

“You don’t want me to know your business because it won’t be good for you.”

By Bill Rusteberg

A consultant friend of ours shared some fascinating data with us. A local hospital in his community has fully complied with the ACA transparency mandate by listing all CPT codes (thousands and thousands of them) with the agreed pricing from all managed care networks they accept as well as Medicare/Medicaid and cash pricing.

This is invaluable data for plan sponsors. For example, if ABC Company has their insurance with Managed Care Provider A, they would see that they are paying +44% more than if they were with Managed Care Provider B (each line entry was exactly a 44% differential between Medical Provider A and Medical Provider B).

The above example is real. How is Managed Care Provider A going to compete for business now? As someone once said “You don’t want me to know your business because it won’t be good for you.”

A smart broker in that community would be wise to identify all groups using Managed Care Provider A and seek out to “educate” them.

There are lots of applications here. Suppose you get a balance bill from this hospital. You can review the reimbursement levels they contractually accept to determine if yours is fair and reasonable. But the main application is starkly apparent – which managed care network has the best pricing – is cash pricing better?

Of course if your plan is a straight Reference Based Pricing plan you control plan expenses, you’re not reliant on anyone else.