When it comes to “shoppable” healthcare prices, transparency is a fine tool. But when transparency translates into value – as in financial rewards for finding lower costs – then it’s not just a fine tool, but one that will be used.
An incentive that rewards consumers with rebates if they find lower costs for services and medications offered on the state’s transparency website is what makes Florida’s new Patient Savings Act a landmark innovation, Gov. Ron DeSantis maintains.
“Transparency is great but if it’s just saving an insurance company money, patients would rather have their time to themselves,” DeSantis said before signing The Patient Savings Act into law in a Jacksonville ambulatory surgery center Wednesday.
“This bill,” he added, “allows for plans for a patient, that if they do choose more affordable options, they share in the savings.”
The Patient Savings Act is among a raft of healthcare-related bills the new governor has been signing this week, including legislation expanding telehealth services and eliminating the “certificate of need” process for hospitals and other healthcare facilities.
On Tuesday, DeSantis signed a bill creating three state-orchestrated prescription drug importation programs into law during a visit to The Villages, a retirement community in central Florida.
The Patient Savings Act, House Bill 1113, was sponsored by Rep. Paul Renner, R-Palm Coast. It was formally adopted on May 3, the last day of the session, by the House in a 105-2 vote and by the Senate in a 37-1 tally.
The new law maintains that healthcare should have the same transparency standards as any other services or products that people shop for in seeking the highest quality for the lowest price.
It requires healthcare providers to post the costs of medical services on websites to be fused into the state’s transparency website to allow consumers to compare prices and present what they think is the best value for the buck to insurers.
The new law directs health insurers who choose to offer such a program to develop a website outlining the range of “shoppable” health care services available to clients.
This website must provide an inventory of participating healthcare providers and an accounting of the shared savings incentives available for each “shoppable" service.
When a consumer obtains a “shoppable” healthcare service for less than the average listed price, the new law requires the savings to be shared by the health insurer and the insured.
“An insured is entitled to a financial incentive that is no less than 25 percent of the savings that accrue to the insurer as a result of the insured's participation,” the law reads.
The law does not apply to emergency services, but to procedures and continued-care treatments, allowing patients to search for high-quality care at lower prices and share it with their insurance providers.
The act covers clinical laboratory services, infusion therapy, inpatient and outpatient surgical procedures, and obstetrical and gynecological services. Also covered are inpatient and outpatient nonsurgical diagnostic tests and procedures, physical and occupational therapy services, radiology and imaging services, prescription drugs and telehealth services.
During committee hearings on HB 1113, Renner said there’s little control on the charges medical facilities bill. He pointed to California studies that revealed wide variations – from $120,000 to $20,000 by nearby providers – for knee-replacement surgery.
Renner said Maine and New Hampshire have adopted similar laws and have seen a much higher rate of use for transparency tools, such as the one the state invested resources on several years ago to create.
On Wednesday, Renner said this was the third session that he tried to get a Patient Savings Act adopted.
“For the first time, [patients’] can put money into their pocket,” he said. “When we go out and shop for something, we know the cost before we buy it.”
Renner said his bill is just one in a “series of the biggest healthcare reforms in a generation” adopted during the session, noting the battle to “cut health care costs and put patients in control of their health care” is only just beginning.
“The Patient Savings Act does just that,” he said.
DeSantis said he has informed the state’s Agency for Health Care Administration [AHCA] that swift implementation of its healthcare pricing transparency tools is among his priorities.
“One of the things we’re looking to do is reduce health care costs, try to have a system that makes more sense in terms of economics,” he said. “One way to do that is try to provide consumers with a way to save their money by picking more affordable health care options.”