Several conversations about healthcare price transparency circulate at the policy level: what the rules require, who has complied, and what enforcement looks like. Equally important is what can happen with the data once it is in your hands.
We were excited to have our CEO, Jerry DiMaso, join Stacey Richter on Relentless Health Value Episode 506 to work through exactly that. Catch the full conversation on the Relentless Health Value podcast. What follows distills the most actionable parts of that conversation for plan sponsors and providers.
Where the data comes from
In 2019, hospitals were required to publish their gross charges, discounted cash prices, and negotiated rates with carriers. In 2022, carriers had to follow, publishing their own negotiated rates through machine-readable files. The result is a dataset that did not exist a few years ago: what payers have actually agreed to pay, across carriers, plans, and provider organizations, available to anyone who knows how to access and interpret it.
For self-insured employers and union plans, this is a meaningful shift. You can search your own plan by EIN to see what your carrier has negotiated on your behalf, compare that against other employers in your industry, and for the first time, do that without asking your TPA to grade its own homework.
What plan sponsors can do with it
1) Benchmark against peers
When you search by EIN, you can pull your own plan’s negotiated rates and compare them directly against other companies operating in your space. The disparities can be significant. If a competitor is receiving meaningfully better rates from the same carrier, that is a data point worth knowing before your next contract discussion.
2) Identify high-cost codes
Not all billing codes are equal in terms of volume or spend. Infusions, musculoskeletal procedures, and a handful of other service categories often account for a disproportionate share of plan costs. Transparency data lets you pinpoint the specific codes where you are paying above market, so your TPA can go back to providers and negotiate with something more specific than a request for a better overall discount.
3) See through the aggregated discount conversation
A TPA showing you a 90% discount across the board may be accurate on codes that rarely get used and significantly less accurate on the codes that drive most of your spend. You can now see both the charged amount and the allowed amount at the code level, which is enough to validate whether the headline number reflects what is actually happening in your plan.
From there, the actions available to plan sponsors include directing your TPA into specific renegotiations, carving out service lines for direct contracts or centers of excellence, and modeling what a different plan structure would look like for your population. All of these become more tractable when you have the rate data to ground the analysis.
What providers can do with it
For clinical organizations, the shift is about leveling a playing field that has historically favored payers. Carriers negotiate with thousands of providers and have a comprehensive picture of rates across the market, while independent practices have typically had access only to their own contracts. With everyone being able to access the price transparency data directly from insurance companies, the information asymmetry is closing.
1) Benchmark rates and defend your value in negotiations
A small practice can now see what every carrier active in their geography is paying for every procedure code they perform. They can identify where they are under-reimbursed relative to neighboring providers, go to a carrier with specific data rather than a general request, and pair that rate data with their own outcomes and quality information to make a defensible case.
Jerry shared an example of a psychiatric provider with strong patient outcomes, specifically around reintegration into the community, that was being under-reimbursed for some of the services where their performance was strongest. Having the data gave them a specific, grounded conversation with their carrier rather than a general ask for a rate increase.
2) Identify new revenue channels
Smaller providers were sometimes unaware of other carriers active in their geography. Transparency data opens that picture up. A practice can discover contracts or carriers they were not previously working with, evaluate whether the rates make sense for their service mix, and make an informed decision about whether to pursue those relationships.
3) Make the case for staying independent
There is a preservation angle here that does not come up enough. When independent practices lose ground on rates and eventually sell to larger health systems, all the prices go up. Keeping independent practices financially viable is good for the whole system, and transparency data gives smaller providers a better chance of making that case before they reach the point of having to sell.
The realistic picture on where this goes
Stacey raised two concerns worth addressing directly. The first is whether transparency causes prices to rise as providers discover they are being paid below market. The second is whether it creates an arms race.
The more honest framing, and the one Jerry landed on, is that the most realistic outcome is a regression toward the mean. When rates are visible, extreme outliers on both ends face pressure. That is closer to how a functioning market behaves than what healthcare has had for most of the last few decades.
The bigger lever may be fiduciary accountability. Plan sponsors can no longer claim they were unaware of publicly available rate data. That changes the calculus for how employers engage with their carriers and TPAs, and the responsibility runs in both directions. Carriers that know their plan sponsor clients have visibility into their rates face a different kind of accountability than they did when that information was opaque.
Jerry also noted that his work with the current administration and CMS reflects a continued and renewed push for more transparency, and that data quality and compliance have both been improving. The organizations getting real value from this right now are the ones who have invested in the methodology to use it well, not just access it.
Let’s keep building and moving price transparency forward together.