State Laws Highlight Need for Price Transparency

Despite the fact that the majority of state legislatures have passed some laws relating to pricing transparency for health care services, only seven states are receiving passing grades for both the statute’s design and implementation, according to the Report Card on State Price Transparency Laws. Price transparency is necessary to combat significant pricing variation for health care services and the increasing financial burden that individuals face, according to the study authors, the Health Care Incentives Improvement Institute (HCI3; Newtown, Conn.) and Catalyst for Payment Reform (Berkeley, Calif.).

Analysts from the Source on Healthcare Price and Competition at the University of California, Hastings College of the Law and the University of California, San Francisco assessed each state’s enacted and proposed legislation on health care price transparency. Each state is given a letter grade with an explanation of the shortcomings that are holding back transparency. The authors say the scoring methodology rewards states that both have an all-payer claims databases (APCDs) and that publish that data on a well designed, searchable website. The researchers found that all but seven states (Alaska, Alabama, Hawaii, Idaho, Mississippi, Oklahoma, and Wyoming) have passed some price transparency legislation. However, the quality of transparency varies due to differences in design and implementation of state laws.