health insurance

Koller orders health care pricing transparency by insurers

CHRISTOPHER F. KOLLER, R.I. Health Insurance Commissioner, announced new transparency "obligations" for health insurers regarding the cost of health care services.
Posted 5/22/13

PROVIDENCE – In a bulletin issued Tuesday afternoon to health care insurers, R.I. Health Insurance Commissioner Christopher F. Koller announced new “obligations” for insurers to disclose the price of health care services to certain health care providers.

The new transparency in pricing rules, which will take effect on June 1, require insurers to provide pricing information, formerly deemed confidential, if it is requested by a designated health care provider “for the purpose of making cost-effective clinical referrals, care coordination, or treatment decision.”

The new regulations specifically defined designated providers who can request such information as those participating in the R.I. Chronic Care Sustainability Initiative, a patient-centered medical home model of primary care supported by all three commercial health insurers in Rhode Island – Blue Cross & Blue Shield of Rhode Island, UnitedHealthcare of New England and Tufts Health Plan.

It would also cover primary care providers and any other health care providers that Koller designates as “having an economic incentive” to make cost-effective decisions.

In addition, Koller issued new broader rules calling for each health insurer to file a “Comprehensive Price Transparency Plan” on or before April 1, 2014, to disclose price information to consumers and other providers, with the goal to “empower consumers and all health care providers to make informed and cost-effective health decisions.

The new price transparency plan will require the insurers to identify health care services, products and supplies subject to price disclosure – including “hospital in-patient and out-patient services, physician services, medical imaging services, laboratory services, prescription drug prices, durable medical equipment and medical supplies.”

The plan would also require insurers to disclose price information “with respect to services reimbursed on a fee-for-service basis as well as services reimbursed by alternative reimbursement mechanisms.”

Under the plan, insurers can “identify” health services, products and procedures that they believe are not subject to price disclosure, or they believe would negatively impact the public interest in competition and affordability.

In preparing the price transparency plans, health insurers are required to submit updates to the commissioner’s office in August of 2013 and during January of 2014.

In issuing the bulletin, Koller wrote: “The Commissioner finds that there are significant variations in the price of health care services that are not attributable to the quality of the service, and that the disclosure of those price variations is necessary to enable providers to make cost-effective clinical referrals, care coordination, and other treatment decisions.”

Encouraging more cost-effective referrals and care coordination, Koller continued, “will protect the interests of health care consumers, and promote affordable health insurance.”

Further, Koller found that “the fair treatment of providers requires disclosure of price information to providers with economic performance incentives connected to the cost-effectiveness of their referral, care coordination and other treatment decisions.”

Koller did not respond to the reporter’s phone calls or e-mails asking clarification for how the new regulations would apply to primary providers involved in current shared savings contracts with health insurers as well as for those primary care providers that have become Accountable Care Organizations.

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