Can you imagine car shopping without knowing prices? While the very idea may seem absurd, medical consumers in the U.S. ― particularly those covered under high deductible health plans ― have been doing it for decades. New price transparency rules appear poised to change that, but will consumers and health plans realize any savings?

And while I might be willing to forgo the special “limited” upgrade package to save money on a new car (farewell heated seats), surely my need for medical services isn’t so price elastic. Assuming many consumers are similarly willing to pay a premium to use their preferred hospital, does knowing other providers’ prices sway spending behavior? And, if so, will they equate higher cost with higher quality or consider it a waste of money?

Such are questions facing actuaries in light of the Hospital Price Transparency rule, effective January 1, which requires hospitals to provide clear, accessible cost information for at least 300 shoppable services. Those items ― 70 of which are directly specified by CMS ― range from x-rays and laboratory tests to bundled services such as cancer screenings. While the price-enlightened consumer often spends less at the car dealership, questions remain on whether the same consumerism applies to colonoscopies.

Actuaries would love to get a predictive grasp on consumer behavior but have often found that the general public doesn’t act “rationally” with respect to medical consumption. And we can’t blame them. Much of this utilization occurs in urgent situations where the patient isn’t necessarily up for price shopping ― especially when their health plan usually pays for the expensive stuff.

Even our own annual Deep Dive data analysis of employer plans has failed to find strong links between HDHP enrollment (which shifts more spending onto the patient) and cost savings to the plan. Not to mention, a 2020 study by the Health Care Cost Institute found that those 70 CMS-mandated services accounted for just 16% of out-of-pocket spend during 2017. And considering that the highest healthcare cost drivers ― including specialty drugs and emergent cell & gene therapies ― fall outside this list, we can only imagine this percentage will decrease over time.

Skewing all this even further is the fact that employers pay a big chunk of healthcare costs, adding complexity to the classic buyer/seller arrangement. To actuaries, this looks like a vague, unpredictable multiplier applied to an increasingly limited subset of costs, the majority of which don’t even make it to the consumer. Would you anticipate significant savings from this?

No doubt, the new rule is a step in the right direction, and many would say long overdue in a country that spends more on healthcare than any of its counterparts. But the jury remains out as far as the rule’s potential impact on healthcare spend, both for individual consumers and health plan sponsors. While we may not be pricing it into the upcoming year’s forecast, we will be keeping an eye out for potential savings in the years to come.

Maybe the real question is, will plan sponsors use the information to make different decisions regarding what they pay for hospital services?

Eric Sepanski, ASA develops health plan design and contribution strategies for clients to balance corporate goals and employee needs.