Transparent healthcare pricing, and what it is worth to an employer

Price transparency has produced an enormous amount of data and a disappointing amount of savings. Machine-readable files are published, tools are launched, dashboards are demonstrated, and the spend does not move.

The reason is not that transparency was the wrong idea. It is that transparency is a precondition for shopping, not a substitute for it — and almost all of the effort went into the precondition.

Why published rates have not moved the bill

A negotiated rate in a disclosure file tells you what one carrier pays one facility for one billing code. It does not tell a member what they will owe. It arrives in a format no member can read, at a moment when nobody is deciding anything, describing an amount that is one component of a bill with several.

Information only changes behaviour when it reaches the person making the decision, at the moment they are making it, in a form they can act on. A disclosure file fails all three tests simultaneously, which is why compliance with the rules and savings from the rules turned out to be almost unrelated.

The estimator tools built on top of that data inherit the problem. An estimate produced from a negotiated rate is a prediction about a component, and the member finds out afterwards which of their assumptions was wrong.

What has to be true for a price to be actionable

A price changes behaviour when four things hold at once. It is the whole price, not a component. It is attached to a specific provider a member can actually book. It is visible before the decision rather than after. And acting on it is no harder than not acting on it.

Miss any one of those and you have published data rather than a functioning market. Miss the fourth in particular and you have a tool that demos well and goes unused, because the default path — call the number on the card, go where you are sent — costs the member nothing to follow.

  • Complete: the number covers the whole service, not the facility fee alone
  • Attached: it belongs to a named provider who can be booked
  • Timely: it is visible before the appointment, not on the bill
  • Actionable: booking at that price takes one step, not a phone tree

Where the saving actually comes from

Two places, and they are worth separating because they behave differently.

The first is variation: the same procedure costs materially different amounts at facilities a short drive apart, for reasons that have nothing to do with quality or outcome. Where a member can choose, choosing well captures that spread immediately.

The second is administration. A transaction with an agreed price and payment at booking has no claim, no adjudication, no denial and no collection. That cost was being paid by somebody, and removing it is a saving that does not depend on anyone shopping at all.

The first requires member engagement. The second does not, which is why it is the more reliable half.

Designing so members actually use it

The most common failure is not technical. It is a design where the entire saving accrues to the plan, so the member is asked to change behaviour for someone else’s benefit and reliably declines.

Arrangements that work share the saving in a form the member can see, keep the booking path genuinely short, and introduce the option before anyone needs care rather than in the week they do. Nobody reads benefits material during a health event.

What this looks like in practice

On Mishe a member sees the price for a defined service at a specific provider, books it, and pays that amount. There is no estimate, no range, and no reconciliation afterwards. The employer sees the same number the member does.

That is the whole mechanism, and its lack of sophistication is the point. Every additional layer between the price and the decision is a place where the saving leaks out.

How to measure whether it worked

Measure the share of eligible care that was booked at a published price, not the number of people who opened the tool. Engagement metrics flatter transparency programmes because looking is easy and booking is the part that changes the bill.

Then measure unit cost on the categories you moved, against the same categories in the prior year. This is the only comparison that isolates the effect of pricing from the effect of utilisation, and it is the one to take into a renewal conversation.

If adoption is low, the problem is almost always friction or incentive rather than awareness, and adding communication will not fix either.

Common questions

Do we have to change carriers to use transparent pricing?

No. Employers commonly run direct-contract pricing for shoppable categories alongside an existing arrangement for everything else, without touching the underlying carrier relationship.

How do we know members will use it?

They use it when it is easier than the alternative and the saving is at least partly theirs. Designs that keep the entire saving at the plan level reliably see low engagement, and that is a design problem rather than a member problem.

Does this work for a distributed workforce?

It works where contracted providers are reachable. A workforce concentrated in a few metros is much easier to serve than one spread thinly across many, and it is worth checking coverage against where staff actually live before committing.

See it for yourself

Every price on Mishe is public. You can check what a procedure costs, and which providers offer it, without an account and without talking to anyone.