What does new hospital price transparency mean for you?

As of January 1, hospitals are now required to post information about the cost of their services.

Will this save you money during your next hospital visit?

That’s the intent, anyway. This new rule is designed to create better-informed customers.

NPR reports that the new hospital rule will allow consumers to see the tremendous variation in prices for the exact same care among hospitals in their areas. It will also make it somewhat easier to estimate what they will be charged for care before it’s delivered.

Not only will each hospital be required to publicly post several prices for every item and service they provide, they also must post the specific costs for 300 common and “shoppable” services, such as having a baby, getting a joint replacement, having a hernia repaired or undergoing a diagnostic brain scan. However, these will be rough estimates and not the exact dollar amount you could pay.

“You’ll get the average price, but you are not average,” says Gerard Anderson to NPR, a professor of health policy and management at the Johns Hopkins Bloomberg School of Public Health who studies hospital pricing.

However, negotiated rates don’t help people understand what out-of-pockets costs they may face from their own personal treatment. Consumers will need actionable pricing information. Many insurers already provide tools to help consumers determine in advance the amount of deductible they’ll owe, and experts expect similar tools to be created now that this data from hospitals is public.

The Centers for Medicare & Medicaid Services, part of the Department of Health and Human Services, has several tips to get the most out of hospital price transparency. CMS recommends you review the data, learn what the potential hospital charges for care will be ahead of time, and shop around multiple hospitals by comparing their prices online.

“It’s very good news for consumers,” said George Nation in the article, a professor of law and business at Lehigh University who studies hospital pricing. “Individuals will be able to get price information, although how much they are going to use it will remain to be seen.”

Some believe that this price transparency can help lower your costs, but the market power of various players might matter more. For instance, a single hospital that is dominant in one area can maintain its position even if its more expensive prices are published online, because consumers don’t have another choice.

Do you think you’ll save money if you know the cost of health care services from a hospital in advance? Share your voice.