Transparency's Importance in Healthcare Choice and Cost 

Employers are grappling with the escalating cost of healthcare benefits. HR and finance leaders are adapting -- as are employees across the nation -- to a ‘new normal’ of narrow networks and high deductible plans. Basic coverage is increasingly augmented by voluntary benefits to meet the varied needs of employees and their families. During this ongoing transition, employees are being asked to more actively participate in the enrollment process.

This new employee empowerment shifts more responsibility of choice to the employee, who is trying to make vital health care decisions, but who, surveys confirm, feels ill equipped, alone, and confused about what the best decisions may be. So what is the way forward?

First, some surprising numbers: According to a 2015 survey by the Kaiser Foundation, nearly two-thirds of American adults say it’s difficult to find out what medical care will cost. Despite that, a mere 3% actually shopped for price among doctors and just 2% for hospitals. In fact, 57% of insured Americans are unaware that physicians charge different prices for the same care, according to Public Agenda.org.

The picture improves when we look at individuals who have easy access to information. A recent study published in the Journal of the American Medical Association (JAMA; June, 2016) found that use of a price transparency tool reached 10% of the 149,000 employees who were offered one.    

Interestingly, a majority of Americans do not equate price with the quality of care. The Public Agenda results showed 71% of insured Americans say higher prices don’t necessarily deliver better quality care, while 63% conclude that lower prices are not an indicator of lower quality care. “Many may be ready to choose less expensive care. Together, these findings suggest that Americans are open to looking for better-value care,” summarized the non-profit, public issues think tank.

That’s good news as the focus for employers continues to shift toward providing employees with the tools they need to make informed decisions about their healthcare. So here are two questions to ask as organizations gear up for 2017 and beyond: Do your employees have access to good information about the cost and quality of healthcare services in their markets? And is your health and benefits platform an inviting place for them to go to find this and other future-ready benefits solutions?