Auditor’s report says state could be doing more to make health care costs transparent for consumers

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Posted on June 25, 2014 in News

Morgan True Jun. 25 2014, 7:57 pm

Vermont is not meeting a legal obligation to use its health care claims database to provide the public with consumer information, according to a new report from the State Auditor’s Office.

The report also found that Vermonters are taking on a growing amount of liability for their health care costs.

The number of high-deductible health plans has grown from 21 percent of the commercial market to 34 percent in three years from 2009 to 2012. A deductible is the amount one pays out of pocket before insurance benefits kick in.

In addition, plans sold on the state’s health care exchange, which opened last year, can leave families with as much as $12,700 in out-of-pocket costs on top of premiums, according to the report.

Making price and quality information accessible could help patients make value-based choices for non-emergency medical care.

The Vermont Health Care Uniform Reporting and Evaluation System (VHCURES) is an all-payer claims database with information on more than 100 million claims paid by commercial insurers, Medicaid and Medicare going back to 2007.

The auditor’s report describes it as, “a digital catalogue of all fees for medical services and products that insurers paid over the last seven years in Vermont.”

VHCURES data has been used to inform health care initiatives including the Blueprint for Health and Green Mountain Care, the state’s planned universal, publicly financed health care program.
State Auditor Doug Hoffer. Photo by Roger Crowley/for VTDigger

State Auditor Doug Hoffer. Photo by Roger Crowley/for VTDigger

State law requires it be used to assess the health care system capacity, inform policy, evaluate programs, compare treatment costs and approaches, improve the quality of health care and inform consumers.

The auditor’s report found Vermont has made progress on all but the charge to inform consumers using the claims data.

“It’s regrettable, but the fact is it’s not too late; they can do it now,” State Auditor Doug Hoffer said. “And that appears to be their intention.”

Hoffer said that consumer information on the price and quality of health care services will still be important, even if the state makes the transition to a single-payer program.

“Providers charge different amounts for different procedures all over the state regardless of whether there’s going to be two payers, one or five,” he said.

The information currently available to consumers is limited and difficult to find.

The legal framework exists to provide consumers with meaningful guidance about health care services, according to the report, but the state has not created an effective program to help patients compare price and quality information specific to their situation, meaning whether they have insurance and what type.

Green Mountain Care Board Chair Al Gobeille said creating consumer tools using VHCURES data is something the board intends to do, but it’s going to take years not months.

“It’s a priority, but it’s not the priority,” Gobeille said, noting that the board has limited resources and is managing several other health care reform initiatives.

The board took control of VHCURES a year ago, and is planning to overhaul the database to make it a more useful tool for the state agencies, contractors and research groups that rely on it.
Consumer tools in Vermont and other New England states

Current law divides responsibility for implementing a consumer information system between the Department of Financial Regulation and the Green Mountain Care Board.

DFR publishes hospital and health plan report cards that illustrate price variation and contain some quality information, but they are of limited use to consumers because they use what hospitals charge, which isn’t what insurers pay, and even the uninsured can access provider discounts.

The department’s online offerings also aren’t attracting visitors, according to the report. The hospital report card site attracted fewer than 700 visitors last year, and the health plan report card site attracted fewer than 100 visitors.

The New England states are leading the way in developing all-payer claims databases, Vermont included, but Maine, New Hampshire and Massachusetts have all experimented with putting price and quality information online for consumers.

New Hampshire launched a price comparison tool in 2007 that allows the public to compare side-by-side price information for 30 common health care procedures based on their situation. Maine quickly followed suit and more recently Massachusetts launched a similar website.

The New Hampshire site,, went dark in 2012 when the state changed vendors for its claims database. But studies of the tool’s impact on New Hampshire’s health care system suggest it had greater impact on providers than consumers, according to the auditor’s report.

Publicly shedding light on price variation among providers led to a restructuring of hospital-insurer negotiations and inspired health plans designed to encourage the use of lower cost services.

The New Hampshire site may have reduced price variation, but it didn’t make health care services cheaper, according to Gobeille.

“Price information has not lowered cost; meaning simply putting it out there isn’t effective,” Gobeille said, “If we do something, I want to make sure it’s effective.”

It’s widely recognized that price information alone isn’t helpful to consumers, and that pairing it with quality or outcome data is important to informing a patient’s choice.

The Massachusetts site provides some quality information for certain providers and services, but it doesn’t provide price estimates based on a specific insurance plan, and the data used is often four to six years old, according to the auditor’s report.

One aspect of the planned revamp of VHCURES is to integrate other health data sets beyond claims – which capture just what was paid – in order to make it more useful. One example mentioned in the board’s RFP is the hospital discharge data collected by the Department of Health.

Consumer tools built on an improved VHCURES system will provide greater value to consumers, Gobeille said.

[Full story here]

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