How healthcare transparency has evolved

For several years, we heard that healthcare transparency would be the wave of the future. The thing that would transform our industry. The end-all-be-all of healthcare consumerism. And yet it still seems like we don’t hear about it as much anymore. Why is that?

In many ways, it is a sign that healthcare transparency has struggled to take hold. However, I’m not ready to declare that transparency is dead. It just needs to evolve. Here are some of the key things that need to change for that to happen:

Difficulty defining quality 

The traditional definition of healthcare transparency was simple: Show information about cost and quality so members could make more informed choices.

It is relatively simple to show members how the cost varies for medications or providers or facilities. The only hitch is that plans are often cautious about sharing data that reveals their contracted rates. Therefore, a lot of the data reflects regional average costs for a procedure – and some databases still rely heavily on government plan data, like Medicare.

The bigger issue is that carriers and vendors still wrestle with how to convey or define quality. Is it about the effectiveness of treatments? The outcomes of providers? Is quality relative to the amount spent (like a measure of ROI) or is it independent of cost? And, above all, how do we show quality in a way everyday members with no medical training will understand.

Until we come to some kind of agreement on what quality means and how we show it, transparency can’t grow. It’s like the battle between VHS or Beta – something has to win out.

Lack of context

Cost and quality data don’t mean a thing if members don’t truly understand how it interacts with their benefits plan. Since transparency data has often been presented in a separate tool in some dark corner of the portal, it doesn’t exist in context, where it could truly help members understand the true impact of their choices on out-of-pocket costs.

For transparency to take hold, we need to present transparency data in context – for example, by showing provider data in the provider finder tool and displaying true out-of-pocket costs alongside benefits. Even better, let’s make it easy for members to take action on the data they see. See a provider you like? Click to schedule an appointment. Found a lower-cost way to fill your prescription? Click to switch.

Focus on cost, not value

This month the National Bureau of Economic Research released a study exploring how members of a large self-insured group changed their spending behavior when they moved to a high-deductible plan. Unfortunately, they didn’t start shopping around for lower-cost services and providers. Instead, they simply reduced their utilization – even for preventive care services. (See more here: What Does a Deductible Do? The Impact of Cost-Sharing on Health Care Prices, Quantities, and Spending Dynamics)

For transparency to take hold, we need to shift the conversation from cost to value. Presenting data in context is a key part of this. So is presenting quality in an understandable way. Only when we make the link between costs and quality, benefits and behavior, will we truly see transparency evolve into what it should be.


Chuck Rolfsen is Chief Revenue Officer for Healthx. He helps Medicaid health plans, commercial health plans and other Healthx clients develop strategies to streamline administrative processes and improve the quality of care.