Texas Told Health Care to Show Its Prices. Now Make Them Mean Something.

Texas told healthcare to show its prices. Now make them mean something.

Texas did something most states haven’t: it made hospitals post real prices, including the discounted rates they’ll take in cash. For a health care system built on hidden costs, that was a meaningful first step toward affordability.

But years later, most Texans still can’t act on what they now know.

Transparency tells you what something costs. It takes competition to bring costs down.

A posted cash price doesn’t help if it can’t be used, or if your insurance routes every dollar through a negotiated network that has no reason to compete on cost. Transparency tells you what something costs. It takes competition to bring costs down.

And Texas needs competition in two places: more companies competing to offer coverage, and more freedom for those companies to pay for care in ways that actually work for patients. Right now, we have too little of either.

Inaction costs Texas families and employers. Rising premiums are the proof.

The consequences are showing up on both sides of the paycheck. Employer-sponsored family coverage now costs nearly $27,000 a year on average, and roughly half of Texans report delaying or skipping care because of cost. Meanwhile, employers are bracing for health care costs to rise more than 8% next year — increases that ultimately show up in premiums, benefits and wages. Workers can’t afford the status quo. Increasingly, neither can the businesses that employ them.

A market built to keep challengers out

I lead Curative Insurance Company, an Austin-based health plan built around a simple premise: remove the deductible, copay and coinsurance for in-network primary and preventive care so people get care earlier instead of waiting until a manageable problem becomes an expensive one.

Bringing our $0 out-of-pocket cost model to Texas taught us why so few companies try to challenge the status quo.

Two insurers control the overwhelming majority of the state’s large-group market. At the same time, nearly seven in ten Texas hospitals now belong to larger systems, up from roughly 56% in 2010. That’s not an indictment of any one insurer or hospital system. It’s basic economics. In a highly concentrated market, there is less pressure to compete on price or product — and newcomers have a much harder time breaking in.

A dominant hospital system can simply decline to contract with a new insurer. Or it can require a plan to accept an entire system’s rates across every facility just to reach the hospitals and doctors its patients actually need. Texas has already prohibited some anti-competitive contracting practices, but these all-or-nothing demands remain a powerful barrier to competition.

Direct payment works. Texas law hasn’t caught up.

We and other new players are finding new ways to pay for care directly. When a provider has already posted a fair cash price, we pay it the same day, with no negotiated network and no claims paperwork standing between the patient and their care. Providers who won’t sign a traditional contract with a small new insurer will often accept direct payment without hesitation. It works.

Think about that: having health insurance can actually prevent you from accessing a lower health care price.

But Texas law hasn’t fully caught up to recognize that direct pay relationship. An insured Texan can’t always access cash prices on the same terms as someone without insurance. Think about that: having health insurance can actually prevent you from accessing a lower health care price.

Texas also still evaluates whether a health plan has an adequate network largely through a framework built around traditional contracts, not the direct arrangements the market is already using to expand access. A plan can demonstrate that patients have real access to quality, affordable care and still fail a test designed around an older definition of what a network looks like.

Three fixes the legislature can make today

The Legislature can fix a market that locks out competition and locks in high prices.

First, judge network adequacy by what actually matters — can a patient get quality care without an unreasonable financial burden — rather than by counting signed contracts alone.

Second, make Texas’ price transparency introduced in Senate Bill 1137 usable. If a hospital or provider publicly posts a fair cash price, Texans should be able to access that price whether they have insurance or not.

And Texas should continue dismantling contracting practices that allow dominant systems to tell new health plans, in effect, take everything on our terms or get nothing at all.

Texas was right to demand transparency. But transparency was never the destination.

A posted price only matters if a patient can choose it. Competition only works if someone new can enter the market and compete.

Texas already told the health care system to show its prices. Now give Texans the power to use them.

Fred Turner is CEO and co-founder of Curative, an Austin-based health plan serving employers across Texas.