Impact of price transparency on maternity cost


With a huge rise in the premiums of private health insurance policies and the co-pay, the cost of healthcare including maternity costs is continuously increasing causing a hefty price burden on the American consumers. One major factor that acts as a hindrance in curbing the cost of healthcare is an absence of price transparency.  

Consumers, payers, and providers have been experiencing an information asymmetry related to healthcare costs and quality. Due to this, these major stakeholders do not get enough information that they need to decide about what is the best option for them. Thereby, consumers cannot search for high-quality, low-cost care.  

However, the current state and federal governments in the United States promote price transparency in healthcare and maternity costs. After the issuance of the Hospital Price Transparency Rule in the year 2021 (January) almost 66 percent of hospitals have started publishing their prices. Furthermore, the group health insurance plan issuers have started disclosing the negotiated prices for all their items and services beginning July 2022, after the issuance of Transparency in Coverage (TiC) rules. 

Costs of Maternity Care 

The average cost of a childbirth in the United States is $18,865, according to the Peterson-KFF [1]. However, this figure varies widely depending on where you live. The highest costs were found in New Jersey ($29,048), California ($26,380) and Florida ($22,015). 

The lowest average costs were found in Nebraska ($8,805), Maryland ($8,934) and North Dakota ($9,225). [2] 

The range between hospitals can also be significant: Some facilities charge as much as $18 more per visit than others do for similar services. 

Impact of Price Transparency on Maternity Costs 

The most obvious benefit of price transparency is that it reduces cost variations. When hospitals and clinics are competing for patients, they have an incentive to lower their prices in order to attract more customers. This competition has led to a decrease in average maternity costs across the country, which means that consumers can expect better deals when shopping around for maternity care services. 

Additionally, increased competition has helped improve patient education about their options before making a decision about where and how much they will spend on their pregnancy care needs. Patients who know what services are available at different facilities have more power over their own health decisions because they can make informed choices based on what's best for them rather than just going along with whatever happens first or cheapest (or both). 

Price Transparency and Payers 

Price transparency is a powerful tool for payers. It increases the ability of insured individuals to make informed decisions about their care, which leads to better outcomes and lower costs. 

Price transparency also allows insurers to partner with providers on innovative payment models that reduce costs while maintaining quality care. 

Price Transparency and Patients 

  • Better understanding of options: Patients have the opportunity to learn about their medical care options, allowing them to make more informed decisions. 

  • Ability to shop around: Patients are able to compare prices between facilities and providers, which can lead to lower costs for patients who choose less expensive providers or facilities. 

  • Informed decisions: When patients are able to see prices for their procedures beforehand, they can decide whether or not they want those services performed by a particular provider or at a specific facility based on cost alone. 

Price Transparency and Providers 

Price transparency can be used to incentivize providers to offer lower prices, improve quality of care, and increase access to health care services. 

The first way that price transparency impacts providers is by making them more competitive with each other. This is because consumers are now armed with information about how much similar procedures cost at different facilities--and they can use this knowledge when comparing prices between hospitals or doctors' offices. This creates an environment where providers must compete for customers based on their efficiency and quality rather than simply charging whatever they want without any regard for market forces or competition from other providers in their area (which may not always be possible). 

Benefits of Price Transparency 

  • Wider industry knowledge of costs. 

  • Improved quality of care. 

  • Lower overall costs. 


As we've seen, price transparency is critical to reducing waste in healthcare. It empowers patients to make better-informed decisions and provides payers with access to accurate pricing information. 

But there's still work to be done. 

As long as the healthcare industry continues its cycle of overcharging for services and products, you can expect prices on your medical bills will continue rising faster than inflation--and that's just not right! 



Add Comment

Zigna’s AI Payor Policy Edit Technology

Most revenue cycle claims editing companies focus on Centers for Medicare and Medicaid (CMS), National Care Determinations (NCD), Local Care Determinations (LCD), and broad national standards. Those are great baselines for medical claim editing, but what moves claims editing from baseline into claims editing with accurate efficiency?

Read More
Healthcare Insurance - Payor policies - What is with all the names?

Health insurance across the US has adopted their own languages, not only across the healthcare industry, but within each payor. If your staff is tasked with locating and reading payment policies you know how time-consuming and confusing it can be, not only to find the policies.

Read More
Only 9 Percent of US adults are aware that hospitals are required

CMS’s price transparency rule is to make healthcare costs transparent and allow patients to compare prices across hospitals to find facilities that offer the same service at a lower cost. But a recent survey conducted by Kaiser Family Foundation (KFF) identified that most of the adults are unaware of this rule.

Read More
Why is Price Transparency Critical to Reducing Waste in Healthcare

The growth of health care cost-sharing in recent years has led to increased demand for price transparency. Federal government, State legislatures and corporate boardrooms have responded with various programs to make the costs of health care services more accessible.

Read More
Price Transparency - Focus on Payers

Price transparency involves informing, preparing, and involving individuals about treatment costs before receiving them. It essentially improve healthcare standards and encourage individuals to get the right treatments without intentional or unintentional delays. In the United States, health spending was found to have increased by 2.7% in 2021 to $4.3 trillion.

Read More