Washington fighting over premiums while prices keep rising
Washington’s recent shutdown theater over who pays for the COVID-era “extra” Affordable Care Act/Obamacare subsidies is loud and familiar—and misses the mark. The spotlight is on insurance premiums and how much will be covered by individuals versus taxpayers. But the real issue isn’t who pays for high prices, it’s why those prices are so high in the first place.
States shouldn’t wait for D.C. to “fix” healthcare. They have the power and responsibility to tackle the root causes of rising costs: opaque pricing, misaligned incentives, limited provider supply, and outdated regulations—which also happen to be some of the same forces driving up insurance premiums. Here are a few examples of smart state policies that lower costs, expand access, and create a more competitive, patient-centered system.
Examples of Good Policy
Codify Price Transparency at All Facilities
Federal rules require price transparency, but those rules could be weakened or repealed. States should lock in transparency by requiring that both cash and insured rates be publicly available at all times. Not every patient will shop, but many want to—and employers need this data to negotiate better deals. Transparent pricing holds systems accountable for both cost and quality, and voters overwhelmingly support it.
Stop Penalizing Patients Who Pay Lower Cash Rates
Cash prices are often lower than insurer-negotiated rates because they’re paid upfront. States should require insurers to count these payments toward patients’ deductibles, even if the provider is out-of-network. This empowers patients to shop for value and bypass network restrictions that inflate costs. States such as Arizona, Indiana, Maine, Nebraska, Oklahoma, Oregon, Tennessee, and Texas have already moved in this direction.
Reward Patients and Providers Who Deliver Ethical Prices
If a patient chooses a lower-cost provider, they should share in the savings. Shared savings programs—already used for public employees in several states—can be expanded to all non-emergency services, in or out of network. States like Iowa have introduced strong bills, but entrenched interests have fought hard to block them.
Leverage the Skills of All Providers
We don’t have enough providers to meet demand. States should revisit scope-of-practice laws (which determine what providers you can see for what kinds of care) and allow providers to work at the top of their license. That includes letting pharmacists diagnose and prescribe, and allowing nurse practitioners to practice independently. States that have done so have increased access and lowered costs. States should also streamline the path for highly trained international physicians to practice in the U.S.
Expand Access Through Telehealth
COVID prompted major telehealth reforms, but huge gaps remain. Few states offer streamlined, cross-state registration for providers. States, like Florida, that have seen a surge of helpful behavioral health providers, especially counselors and social workers, are a good example. This is a game-changer for rural areas and mental health deserts.