Legislation tackles high healthcare costs with free market principles
On Wednesday, State Senator Mary Felzkowski (R-Irma), State Senator Julian Bradley (R-Franklin), State Representative Rob Brooks (R-Saukville), and State Representative Donna Rozar (R-Marshfield) introduced the Know Your Healthcare Costs Act (LRB-1676). The Wisconsin Institute for Law & Liberty (WILL), Wisconsin Manufacturers & Commerce (WMC), and other business groups came out in support of the legislation, as it would lay out clear requirements for hospitals to share pricing with consumers. A press conference was held at the Wisconsin State Capitol to formally introduce the bill.
WMC Senior Director of Workforce, Education & Employment Policy, Rachel Ver Velde, stated, “Informed health care consumers create a competitive market. Therefore, it is vitally important for employers and their employees to have access to transparent and easily understood medical cost data. WMC applauds Senator Felzkowski and Representative Brooks for introducing this legislation and encourages other legislators to support this important tool for employers.”
WILL Research Director, Will Flanders, PhD, added, “Healthcare is the only sector of the economy where patients have to pay for services without first knowing the cost—leading to uncertainty, surprise medical bills, and patients avoiding or delaying care. Greater transparency will introduce market forces into healthcare, driving greater competition, lowering costs and empowering patients to take control of their healthcare.”
Willard T. Walker, President and CEO of the Walker Group, continued, “Wisconsin employers are extremely concerned about the increasingly unaffordable cost of healthcare. Price transparency will drive competition and empower employers and their employees to be informed consumers and find the best care at the best price. As our state legislature convenes for the 2023-24 legislative session, we need the necessary tools to help employers and employees make smart healthcare choices.”
The Know Your Healthcare Costs Act would introduce healthcare price transparency measures in Wisconsin that closely mirror federal hospital price transparency rules that were enacted in 2021. These rules, promulgated under President Trump and continued under President Biden, require hospitals to provide cost information for certain services to patients and the public.
The bill would require hospitals to make a machine-readable digital file publicly available that contains a list of standard charges for certain items and services provided by the hospital, as well as a consumer-friendly list of “standard charges” for certain shoppable services. These “standard charges” must be always available to the public and must be displayed in a prominent location on the home page of the hospital’s website.
Wisconsin’s hospital costs have risen to the 4th highest nationally. Families have become increasingly concerned about the price of healthcare, with 67% of Americans reporting that they worry about unexpected medical bills. Recent polling shows that 90% of Wisconsinites support greater healthcare price transparency to better control healthcare costs.
Price transparency is a tool that puts power back into the hands of patients—giving them an outlet to shop for services, compare prices, and make more informed decisions about their health. Established federal rules already require hospitals to disclose pricing information. However, a recent review found that only 45% of sampled Wisconsin hospitals were fully compliant with the federal rules. In response, several states have taken bipartisan action to codify price transparency requirements into state law, including Colorado and Texas. The proposed legislation would build on those efforts.