Health Care Price Transparency: A Meeting Of The Minds In Kentucky

The Foundation for a Healthy Kentucky held its second health care price transparency symposium on October 16.

This convening occurred a year after the foundation’s first symposium, in which state and national speakers discussed the need for price transparency in the collective effort of health care leaders to meet the unmet health care needs of Kentuckians through policy work. These symposia are part of the foundation’s broader Promoting Responsive Health Policy initiative, which has the goal of making policy more responsive to the health and health care needs of Kentuckians.

To better understand the importance of price transparency, it’s important to know about the significant health policy changes that have occurred in Kentucky over the past few years. Since the enactment of the Affordable Care Act, more than half a million previously uninsured Kentucky individuals and families are now covered by public or private insurance—through the state’s health benefit exchange, which is called kynect, and the state’s Medicaid expansion. Kentucky has been held up as an example of success in both establishment of a state-based exchange as well as in outreach and enrollment in both Medicaid expansion and private, qualified health plans sold through the exchange.

The Foundation for a Healthy Kentucky believes that credible, objective information available to consumers and others is essential to sustainably transforming the health care system and improving the health of Kentuckians. Clear, factual information about the price and quality of health care is necessary for consumers to select value-driven care and be involved in decisions about their health and health care services.

Since the first price transparency symposium, the state of Kentucky has engaged the University of Kentucky in a process of creating a Kentucky-based and -designed all-payer claims database (APCD). The APCD is called Kentucky Health Data Trust and aims to “improve the health of Kentucky’s children, families, and workforce by providing complete and transparent information about health care utilization and outcomes.” Currently, the Health Data Trust is in the first phase of development, with anticipated launch of the full-functioning APCD in late 2017.

More details of the Kentucky Health Data Trust are available through the slides presented at this year’s symposium by John Langefeld, chief medical officer of the Department for Medicaid Services for the (Kentucky) Cabinet for Health and Family Services, and Jeffrey Talbert, associate director of the Center for Clinical and Translational Research at the University of Kentucky. Both presenters cited the foundation’s issue brief on price transparency, and the recommendations therein, as guideposts in the creation of the Health Data Trust.

The 2015 symposium was a much more “in the weeds” meeting, with speakers from elsewhere providing a more detailed presentation of their state’s APCD. Additionally, an overview of APCDs was provided by John Freedman, who is currently working with the state of Kentucky on developing the Kentucky Health Data Trust.

While transparency is a recognized function of APCDs, Freedman reminded the symposium attendees that APCDs can play several important roles, related to the following topics:

1. Public health
2. Transparency
3. Performance improvement
4. Consumer education
5. Insurance rate review
6. Risk adjustment
7. Administrative simplification
8. Research
9. Health policy

(The above list is excerpted from consultant John Freedman’s more detailed slide presentation at the symposium.)

Freedman spoke of the importance of consumer education to maximize the potential of the APCD. As with any new technology, it will take time, exposure, and optimizing ease of use for consumers before they can be comfortable with, and benefit from, using APCDs. Eventually, APCDs will be able to link to electronic medical records for more personalized and tailored information.

Langefeld and Talbert provided some examples of the role of APCDs in public health. Kentuckyhealthnow (an initiative of outgoing Gov. Steve Beshear (D) that lays out seven health goals for the state to achieve by 2019), for example, relies on having baseline health data to measure and track changes. Through the Data Trust, such data will be available and able to be connected to population health data, to identify not just progress toward health goals, but to better understand what factors affect health outcomes at a population level.

Kenley Money and Jim Lucht provided examples from Arkansas and Rhode Island, respectively, on experiences developing and implementing a state-level APCD. Their presentations provided insights into (1) the technology aspects of an APCD, (2) data collection and analysis, and (3) sustainability. (Their full presentations are available on the foundation’s website.)

Increasingly, health policy changes are creating incentives to move our current “patchwork” health care system to a more seamless and value-based (in contrast to volume-based) system. In this ever-changing health policy environment, APCDs are a necessary tool to engage consumers in improving their health and to improve quality of care while controlling or even lowering costs.

The Foundation for a Healthy Kentucky will continue its work in Promoting Responsive Health Policy as this and other policy changes evolve. An issue brief will be finalized by the end of 2015, so be sure to visit the foundation’s website then for more information on Kentucky’s Health Data Trust and the importance of price transparency and quality improvement as we continue to work toward achieving accessible, high-quality care for all Kentuckians.

Related posts from Health Affairs Blog:

“Promoting Transparency And Clear Choices In Health Care,” by Joel White of the Council for Affordable Health Coverage, June 9.

“A Foundation Delves Into Health Care Price Transparency,” by M. Gabriela Alcalde of the Foundation for a Healthy Kentucky, May 21.

“Building Cost Transparency From The Ground Up,” by Tara Oakman of the Robert Wood Johnson Foundation, April 20.

“Academic Medical Centers Should Lead The Charge On Price Transparency,” by Giffin Daughtridge (a medical student at the University of Pennsylvania) and Richard Shannon of the University of Virginia Health System, January 21.