GAO paper recommends improved health care price transparency

Posted on September 24, 2011 | No Comments
Filed under Government Accountability Office, Health Insurance, Library

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Key Developments

Implementation Briefs

Consumers are responsible for increasing proportions of their health care costs. Health care price information that is available before consumers receive care, or transparent, may help consumers anticipate such costs. In a recently released report, the U.S. Government Accountability Office (GAO) examined 1) how various factors affect the availability of health care price information for consumers and 2) the information selected public and private health care price transparency initiatives make available to consumers. GAO reviewed price transparency literature, interviewed experts, and examined eight federal, state, and private insurance company health care price transparency initiatives. The report recommends that the Department of Health and Human Services (HHS) determine the feasibility of making complete cost estimates of health care consumers available to consumers.

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HHS announces release of tool for small businesses to compare health insurance plans

November 18, 2011

The U.S. Department of Health and Human Services announced the release of a greatly expanded website to give small business owners a venue to review health insurance plan choices. The tool enables small business owners to compare the benefits and costs of health plans and choose those that are best for their employees. Small businesses will be able to research locally available products in an unbiased manner. The aim of the tool is to foster a more transparent and competitive marketplace. At present, the market is often difficult to analyze and small businesses do not fare as well as their large employer counterparts when negotiating health care prices. Ideally, the new tool will help ensure insurance companies will compete for business on the basis of price and quality. The tool was created under requirements contained in the Affordable Care Act (ACA). The Centers for Medicare & Medicaid Services collected information from insurers across the country to develop the site. Information on the website includes:

Insurance product choices for a given ZIP code, sorted by out-of-pocket limits, average cost per enrollee, or other factors.
A summary of cost and coverage for small group products that shows the available deductibles, range of co-pay options, included and excluded benefits, and benefits available for purchase at additional cost.
The ability to filter product selection based on whether the plans are Health Savings Account eligible, have prescription drug, mental health, or maternity coverage, or allow for domestic partner or same sex coverage.

Government tool promotes transparency regarding insurance rate increases

October 7, 2011

Since September 1, 2011, health insurance companies have been required to inform the public whenever they want to increase health insurance rates for individual or small group policies by an average of 10% or more. Insurance experts in state or federal government will then review these rate increase requests in a process known as "rate review." On Friday, the Obama administration released a Web-based tool that will allow consumers to track when health plans are considering steep premium hikes. The new tool enables insurance customers to search for potential hikes by state.

Update: Disclosure and Review of Unreasonable Premium Increases

June 3, 2011

An earlier Implementation Brief provided an overview of the Disclosure and Review of Unreasonable Health Insurance Premium Rate Increases, which was established by §1003 of the Affordable Care Act (ACA) by adding §2794 to the Public Health Service Act (PHSA). On May 23, 2011, the Centers for Medicare and Medicaid Services (CMS) of the U.S. Department of Health and Human Services (HHS) published a final rule (with comment period) establishing a rate review program of “unreasonable” health insurance premium rate increases and implementing requirements for health insurance issuers regarding the disclosure and review of such unreasonable premium increases.

Disclosure and Review of Unreasonable Premium Increases

April 14, 2011

Over the past decade, health insurance premiums have doubled (with particularly sharp increases in the small group and individual markets), making insurance coverage unattainable for millions of Americans. News stories have reported that some health insurers have sought to increase premium rates as much as 50 percent.