The Quest for Healthcare Transparency: Understanding the Transparency in Coverage (TiC) Rule

It seems as though each day we hear another story (or experience it ourselves) of a patient being blindsided by unexpected, outrageous, and delayed medical bills. Not surprisingly, medical expenses are the leading cause of bankruptcy in the United States, accounting for 66% of personal bankruptcies¹.

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From the former US Surgeon General Jerome Adams sharing about his costly treatment for dehydration to Marc Cuban of CostPlus Drug Company discussing the real cost of healthcare, people are fed up and speaking up about transparency, or the lack thereof, in healthcare.

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Why Now

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Healthcare expenditures are soaring, with total costs expected to rise from $4.7 trillion in 2023 to $7.2 trillion by 2031², according to the Centers for Medicare and Medicaid Services. Consequently, the demand for transparency in healthcare pricing has become increasingly vocal and necessary. In response, several legislative measures, including the Transparency in Coverage rule, have been implemented to ensure greater pricing clarity.

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What is the Transparency in Coverage Rule (TiC)

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The Transparency in Coverage Rule (TiC) aims to increase transparency in healthcare pricing and coverage to help consumers make more informed decisions about their care.

The rule requires health insurers and plans to publicly disclose pricing information, including medical items and service costs. Specifically, it mandates that they provide accessible data on negotiated rates with healthcare providers and historical pricing for covered prescription drugs. This information must be available through online tools and should be updated regularly to reflect current prices.

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What Does TiC Mean for Self-Insured Employers

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The TiC Rule introduces new responsibilities and opportunities for how self-insured companies manage health benefits. With the intention of peeling back the layers of opacity that have traditionally surrounded healthcare pricing, TiC could lead to more cost-effective healthcare utilization and potentially reduce overall costs for both employees and employers.

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Employers and Human Resources teams can find it challenging and time-consuming to navigate compliance. With a well-crafted approach and collaboration with trusted partnerships, organizations can meet compliance and foster an environment where employees are equipped to access high-quality, low-cost healthcare, resulting in reduced healthcare costs, better health outcomes, and increased employee satisfaction and productivity. 

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Employer Responsibilities as of January 2024

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Post machine-readable data files online, including:

• Negotiated rates for in-network providers

• Historical data regarding charges from out-of-network providers

• Negotiated in-network and historical rates for all covered prescription drugs

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Provide employees with an online healthcare search navigation tool:

• Includes all shoppable items or services

• Includes estimates for out-of-pocket costs for these items or services

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How Faros Supports Healthcare Transparency 

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If your organization is looking for a better search tool, Faros Health's intuitive platform, ENLIGHT, can fulfill TiC obligations while also promoting transparency and employee empowerment to navigate the healthcare landscape confidently.

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Looking Ahead 

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As the healthcare industry adapts to transparency mandates, experts have yet to fully realize the ultimate impact on consumer behavior and healthcare costs. The effectiveness of the TiC Rule in making healthcare transparency clearer will depend on the continued enforcement of policies and the innovation of tools and services that help consumers navigate this new landscape.

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We, at Faros Health, look forward to creating a more transparent future —where patients are empowered and informed at every step of their healthcare journey. 

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Visit www.faroshealth.com to learn more.