State insurance regulators are exploring ways to make New Hampshire’s health care market more transparent – and keep rising medical costs in check.
New Hampshire is already one of the few states with a comprehensive online tool that allows patients to compare what different providers charge for common medical procedures. The launch of that website, NH HealthCost, in 2007 led to lower prices over time, according to a 2018 study that looked at medical imaging services.
State insurance officials say they’d like to build on that success. On Friday, the New Hampshire Insurance Department hosted three experts for a panel on price transparency at its annual hearing on health care premiums.
Insurance Commissioner D.J. Bettencourt called price transparency a “long-term project” for the department. He said the ideas discussed Friday could inform policy discussions with the governor and lawmakers.
“The key takeaway, I think, is that price transparency works as a fundamental matter,” he said after the panel, held at UNH’s Franklin Pierce School of Law in Concord. “The key is how best to approach it.”
This comes as the health care industry in New Hampshire and the rest of the country continues to consolidate. The experts who spoke Friday said those mergers tend to lead to higher prices.
“Hospitals that are in a dominant market position are the ones that are able to charge higher prices,” said Chris Whaley, an associate professor at Brown University’s School of Public Health and a health economist at the nonprofit research group Rand Corporation.
By contrast, he said, there’s only a “minimal” correlation between what a hospital charges and the quality of its services.
Whaley presented data on how expensive different health care systems are, using what Medicare pays as a baseline. He said these prices can vary widely.
In New Hampshire, for example, North Country Healthcare charged commercially insured patients about 1.5 times what Medicare pays, according to claims data from 2018 to 2020 analysed by researchers at the Rand Corporation. Meanwhile, prices at HCA Healthcare and LRGHealthcare (now part of the Concord Hospital system) were about three times Medicare rates.
“Even among hospitals in the state of New Hampshire, there’s about a twofold variation in prices,” Whaley said.
Dr Zach Brown, a health economist at the University of Michigan who wrote the study on the NH HealthCost website, said transparency can lower prices by allowing patients to shop around and giving employers more information when choosing networks. It can also lead to scrutiny from reporters and regulators, which can put pressure on health care providers to lower prices.
“One study found that nationally, 10% of people pay less than $700 for an MRI,” he said. “However, there’s 10% of individuals who pay over $2,000 for the exact same MRI.”
But for transparency to be effective, Brown said, it may need to be combined with other policies – such as measures to prevent healthcare monopolies.
“If individuals can’t shop around, if there’s no choice, then we wouldn’t expect price transparency to make a difference,” he said.
Maureen Hensley-Quinn of the National Academy for State Health Policy, a nonpartisan health policy organisation, said states are starting to ban certain anti-competitive contracting practices.
“You can’t undo some of the relationships and mergers and affiliations that have taken place,” she said. “But you can try to mitigate some of the anti-competitive behaviour that happens once that happens.”
Bettencourt said the presentation had “a lot of good ideas” when it came to analysing the contracting process between insurers and healthcare providers.
“We want to make sure that the consumer benefits from the free market system, which means there has to be healthy competition,” he said.
