Leveraging Price Transparency as a Marketing Opportunity
Healthcare marketing is generally focused on highlighting the expertise of practitioners, the use of advanced technology and treatments, and the delivery of compassionate patient care. The cost of services is not usually part of the messaging, maybe because healthcare costs seem to strike a sour note with consumers. The Hospital Price Transparency Law presents healthcare marketers with a challenge to incorporate price into their campaigns.
CMS Delivers Lemons
According to the Centers for Medicare & Medicaid Services (CMS), price transparency is meant to clarify, for patients, the hidden costs of services. Price transparency will educate patients on the charges associated with 300 common hospital services, allowing patients to compare the cost of those services at different healthcare facilities.
The Hospital Price Transparency Law, enacted in January 2021, stipulates that all healthcare facilities licensed as hospitals will achieve the required transparency in two ways:
- By posting a spreadsheet on their public website that contains the list of charges for all their services, including discounted cash prices, the highest negotiated charge, and the charge negotiated with a third-party payer
- By displaying a list of procedures grouped with ancillary services, described in plain language, that consumers can schedule in advance and pricing that includes discounted cash prices and any charges negotiated with third-party payers
All pricing information must be updated annually and clearly marked with the date of the last update. An online price estimator tool that consumers can use to help them understand the costs of any schedulable procedures may meet the second requirement of the law if it provides all the information necessary, is prominently displayed, and clearly identifies the hospital location.
You Make Lemonade
The idea of adding price transparency to your healthcare system website might initially leave you feeling a little sour. However, embracing the change could present many opportunities. By leading this price transparency initiative from the marketing department, assembling the right team, and learning about how your hospital’s pricing structure works, you could turn an apparently onerous regulation into an additional way to cater to the patients of your healthcare system and stand out among the competition.
The new regulation is an invitation to mingle marketing with pricing, something that probably doesn’t happen at your hospital right now. To start, you’ll need to work with members of the administration to understand the pricing structure and define it in marketing terms. Begin by asking healthcare system executives some key questions:
- How will our value proposition evolve with transparency?
- What are our patient incentive programs? How can these drive patients to high-value providers?
- How can we optimize our market position with strategic pricing? How will any proposed changes affect our financial performance?
- How will our negotiated prices be affected by changes to our pricing structure?
- How should we adjust our prices at alternative care sites? What is the growth projection for alternative care sites in our market?
Next, involve IT staff to build the price estimator and media folks to incorporate it into your website and refine the user experience. Testing will, of course, be crucial to establish a pricing tool that is both accurate and easy to use.
Don’t forget to include clinical staff, since they are the ones who will be explaining the procedures and any necessary ancillary services to patients. What clinical staff says should match up with what consumers learn on your website to crystalize communication.
Clarifying the Recipe
Healthcare pricing is inherently mysterious to consumers because it involves several mechanisms at work, formerly behind the scenes, that they are not familiar with. Price transparency seeks to demystify healthcare prices, but it is not as easy as waving a magic wand.
The price transparency requirements will put a lot of data in front of patients. Data is great for making decisions as long as you know how to interpret that data. The challenge on the marketing side of price transparency will be to educate patients about what they need and help them sift through the data to clarify what applies to them.
Add Some Sugar
Here are six tips for developing effective marketing campaigns around price transparency:
- Educate Consumers: Price transparency will be a difficult concept for many consumers to understand. You will need to develop content that explains the value of price transparency to the individual patient and helps them understand how to use it to their advantage.
- Provide Price Estimator: Tools for using the pricing information you present are essential. The user experience will be greatly enhanced if consumers can accurately and efficiently determine the price they would pay for the services they need. The list of all prices will provide the same information but may be cumbersome for users to navigate. An estimator that adds in the necessary ancillary services for each procedure and does the math would be ideal.
- Offer Cost-Management Resources: Looking at the total cost of a procedure up front might be overwhelming for some consumers. You’ll want to include links to financial services or content that explains self-pay discounts and available payment plans. As long as consumers are taking the time to consider pricing, you should give them all the options available to them.
- Speak to Patients Who Have No Health Coverage: No one wants price transparency to become a deterrent to seeking appropriate medical procedures and screenings. This is a good place to include information about government-funded health coverage programs and other payment options patients could take advantage of.
- Use Professional Resources: Pricing resources are not just for patients. Healthcare systems can benefit from professional resources like the American Hospital Association’s toolkit designed to help communicate pricing information in a way that is helpful to patients. The toolkit includes several case studies so you can learn from the pricing transparency experience of other hospitals.
- Design Campaigns to Promote the Benefits of Your Price Transparency Program: Once you’ve developed the most accurate, easy-to-use price transparency program, you can promote it. Marketing messages around pricing might be delicate to navigate, but price transparency can be completely patient-centered. Your price transparency tools demystify hospital pricing, improving the user experience on your website. And the transparency adds to your hospital’s professional credibility. Campaigns that promote your trusted healthcare brand are sure to convert.
Need help rising to the challenge of incorporating required price transparency into your healthcare system marketing strategy? Contact LIGHTSTREAM for the support you need to make this and other marketing campaigns for your healthcare system a success.
