Consumer Directed Healthcare

The need for healthcare pricing transparency is the hottest conversation right now in the world of consumer directed healthcare. (www.galen.org) There are initiatives forming at the state, local, regional and government levels.

In a March 14 speech, Mike Leavitt, secretary of the Department of Health and Human Services (HHS), announced his intention to create transparency in quality and price. The federal government makes up 46% of the entire payer market, according to HHS but has not been a participant in the efforts to control cost. (www.managedhealthcareerexecutive.com).

A Pennsylvania lawmaker proposed a price transparency bill for pharmacies and Hospitals (www.medicalnewstoday.com). The intent was to create a way for consumers to view the top 150 most popular prescription drugs. The pharmacies would update their drug list monthly and could change prices at any time as long as their in-store price list are updated at least once a week. The bill also calls for the creation of a hospital payment registry. The registry would be updated annually and include payments received by hospital for the 150 most common admission diagnoses and most often dispensed drugs.

These conversations are not surprising. Studies indicate the patients are 58 percent more likely to switch to a more cost-effective prescription drug or a lower-cost pharmacy channel when they can comparison shop for drugs. The analysis conducted by Medco Health Solutions, Inc, found that patients are willing to price shop on prescriptions drugs when presented with clear information on their clinical alternatives, channel options and overall savings. (www.medcohealthsolutions.com)

The notions of consumer-driven healthcare and price transparency are going to fundamentally change how Hospital and Pharmaceutical marketing takes place. Price transparency and consumer-driven healthcare will force marketers to engage with consumers healthcare as never before. With the media reporting issues surrounding hospital and drug charges nearly every day, price is an increasing important portion of the marketing mix.

The next phase in price transparency must come directly for physicians who need to voluntarily post their prices so consumers can know directly and up front the full cost of a visit or procedure. One of the forces driving this will be consumer directed healthcare where consumers will want to get the best cost and quality as they spend their deductible dollars.