Kendall Jones (00:06)
Welcome to Whitley Penn Talks, where we give you valuable insights to help you make confident, informed decisions and move your business forward. My name is Kendall Jones and today we are talking healthcare transparency act. Joining me today are John Karp and Jolie Patnaude. I’m so excited to have you both and to get into this discussion today. So before we do that, let’s go ahead and have each of you introduce yourselves. So John, we’ll start with you. Tell us a little bit more about your role at Whitley Penn and the kinds of clients that you focus on.

Jon Karp (00:35)
So my role Willie Penn here, I’ve been a tax partner here since 2011 when I joined. And I’ve specialized in the healthcare industry and myself and a few of the other partners. We run our healthcare group and healthcare has always been an ever-changing and dynamic discipline for us to be in. And we have really just trying to keep up with the times.

Kendall Jones (00:58)
Awesome, well we’re happy that you’re here. And Jolie, newer to the firm, tell us a little bit more about your role and what you focus on.

Jolee Patnaude (01:03)
Yes.

So I’m new to Whitley Penn. I am the Revenue Cycle Management Director for Consulting. ⁓ I’ve been doing healthcare for 30 years, but I’ve been focusing on revenue cycle management for about 25. So ⁓ I’m certified in coding and compliance, and ⁓ I’ve been doing billing for very long time. So ⁓ that’s kind of what I do, and it’s what I enjoy.

Kendall Jones (01:34)
Awesome, well thank you. And for those listening that may not be incredibly familiar with revenue cycle management, can you tell us a little bit more about what that entails and what parts of the billing process you consult on?

Jolee Patnaude (01:48)
So revenue cycle management in healthcare is basically from the time that the patient calls to set up a appointment or come into the facility all the way until the claim is paid or the patient pays their balance. So it’s from the whole process. ⁓ And I’ve been doing this for very long time and I consult on everything from registration or patient access, coding, documentation, medical records, HIPAA, billing, and then your final collections, patient financial, so it’s basically the whole process.

Kendall Jones (02:24)
Awesome. Primarily for hospitals, specialty, doctor’s offices or the like, both of them.

Jolee Patnaude (02:31)
I’ve done multiple service lines from home health and hospice to physician practices to hospitals, ⁓ R.H.C.s, which is your rural facilities ⁓ and rural health clinics. So ⁓ basically, as I like to say, basically the gauntlet. ⁓ There’s not too many that I haven’t touched. So about the only ones I really haven’t delved into is like your D.M.E.

Jon Karp (03:01)
Hey, so, Jolee, for those who, like, might not know what DME is, what is that?

Jolee Patnaude (03:01)
So DME is durable medical equipment. So that’s like if you need like your oxygen tanks, your walkers, your wheelchairs, beds, that kind of stuff, that’s what your DME falls under. ⁓ I’ve done it in facilities and such, but I’ve never actually just worked for a DME. It’s a very specific area. ⁓ But yes, I mean, I know it because of coding and such, so yeah. But that’s pretty much what DME means.

Kendall Jones (03:36)
Awesome. Well, thank you for sharing a little bit about that. Our resident health care experts for sure. So we’re excited to have both of you on and to talk a little bit more about health care cost transparency and some of the changes that we’ve seen just this week in this space. So I know there was an executive order that came out earlier this week focused on updating the health care cost transparency act that originally came out, I think in 2019 and has been updated a couple of times since.

There was a Bloomberg article focused on it and just a lot of conversation around the topic so far this week. Jolie, can you tell us a little bit more and break down how we got here? What’s the current executive order looking like and what was the original act attempting to do starting in 2019? How has it been updated since and what are the implications there?

Jolee Patnaude (04:27)
Sure. So in 2019, the original act was to basically make it more consumer based so that the patient would understand what they’re paying for, why the costs was the cost for different services that were being rendered. And initially was supposed to basically help the patient to make an educated decision as to do I go to this hospital? Do I go to that hospital? And just kind of be able to, as they say, shop around. ⁓ That was the initial. A lot of facilities or hospitals kind of were like, okay, we’ll do the best we can because they do have to create two separate ⁓ platforms of how this is displayed. ⁓ One is consumer friendly. So that’s specifically for the patients. And the other one is mainly for like your insurances and CMS to look at. ⁓ And CMS is your, yep, is your ⁓ central medical services. So that’s basically your Medicare, Medicaid, and for those listening, and those areas are kind of fall underneath that. And then so initially it was set up to start doing that, which some did start putting it on their websites, which is the easiest way to look this up. And then in 2022, it was upgraded because a lot of them weren’t doing it. So initially there was only like 14 % that were actually putting it through their systems and making sure that this was updated on their websites.

Kendall Jones (05:30)
Mm-hmm.

And that’s 14 % of hospitals, correct? 

Jolee Patnaude (05:54)
Of hospitals, only hospitals. This only affects…The way it’s worded, only affects specifically hospitals or anything that falls underneath the hospital criteria. So then in 2022, they beefed it up because previously they were only having to pay like up to about a hundred thousand dollars a year in fines if they got fined for not having this done. But in 2022, they upped it to two million per year that they could be charged. And so in some research that I did do the hospitals that did actually get fined in the last year or so. There was a hospital in Chicago that got fined for the year $847,000 for not having this updated on their website and not having the ⁓ thing that the patient could actually go and look up. So they can use ⁓ a CPT code, which is what they’re given of what they’re going to the service that will be performed. ⁓

Jon Karp (06:53)
Define CPT code for everybody.

Jolee Patnaude (06:55)
So the CPT code is a current procedural terminology. So this is something that is used in healthcare to, so you’re not writing out that the patient went in, a CT scan for, with contrast, there is a code attached to that specific service. So then that way it can be put on a claim form that’s sent into the insurance. It’s a whole, it’s a setup that helps so it’s not everything is.

It’s kind of more encompassed under the code. So it’s easier for people to, or I shouldn’t say people, for the systems to process. And then, so for now, in the new, the newer act in 2025 that was updated again, the previous acts said estimate. So this would be something that, you know, you get in there and you’d like, well, we can estimate that this is how much this is going to be for the patient. Now it’s like actual cost. So you actually have to tell the patient, if you go in for an X-ray, it’s going to be ⁓ $150 where previously they’d be like you’re gonna have an x-ray done. It might be 125 plus or minus, know, whatever amount that the facility decided to put on there But now it has to be the actual cost So there are specific services that it falls underneath this the list is mostly your diagnostic I mean there are other things in there and it does include the ED Which is your emergency department?

So this actually falls underneath there which can be kind of confusing for some because coming into the ER, you come in because you don’t, you know, that’s an emergency situation or you feel like this is something that’s, you urgent. So there’s gonna be kind of a hit and miss, I think, on this just due to the fact that you can’t really say it’s gonna be a level two and then the patient gets in there and it’s a level three. 

Jon Karp (08:41)
Like, what would a gun shot wound be?

Jolee Patnaude (08:43)
That’s like a level four, level five. So that’s like your ultimate trauma, you know, and only specific facilities can take those types. 

Kendall Jones (08:50)
Yeah. Well, what if Jolie, like, what if I go in and I’m level two trauma? I mean, how does that experience affect the patient? Do they have to re-quote the new procedures immediately? Do they not do treatment because they didn’t effectively determine that? Okay.

Jolee Patnaude (09:04)
Well…no, no. there’s regulation and laws that you have to stabilize patients regardless, no matter what. ⁓ So in this context, it would be more the fact of if the patient asks, then they would probably have to do it. But I’m thinking that in the long run, this is going to be something because at this point, they don’t have everything spelled out as to how this has to come forward for the patient.

Kendall Jones (09:16)
Right.

Jolee Patnaude (09:36)
For the emergency departments, I think it’s gonna be more along the line of, is what you’re coming in as this, this is gonna be the cost that we can tell you right now until we actually look at you and figure out exactly what’s gonna happen. Because they’re not gonna know if they have to give the patient morphine or if the patient can’t have morphine and needs codeine. So there’s all these little different things that happen. So ⁓ they call it practicing medicine for a reason, not just you’re gonna come in and we’re know right then and there to do this, this and this. It’s really not as easy as I like to say, as you see on TV. it’s a lot, there’s a lot more to it. No, I really wonder. Yeah, the first time I watched that and I was working in the hospital, I’m like, wow, where did they get this? I’ve never seen this stuff. 

Kendall Jones (10:08)
Yeah, not like Grey’s Anatomy.

Jon Karp (10:09)
So I think the emergency rooms are going to be the hardest part of this because there’s, as Jolee said, there was years ago, there was called the EMTALA, if I’m pronouncing that right, law that passed. And what that says is they’re not even allowed to ask you if you have insurance when you walk into the ER. Right? Like, I mean, they’re supposed to triage you, take you in right away, whatever you need, and you might be unconscious. So you’re definitely not asking how much it costs. So I think that’s going to be the one part of this that is going to be tough. The interesting part is if you look at most insurances, right, you always have an ER copay plus a percentage, and it’s that percentage is which, which is what’s going to hang everybody up. because it’s a percentage of what number from an ER visit, right? So the ER is gonna be the tough part.

Jolee Patnaude (11:02)
Yep, exactly. Yeah.

So I think when they start really kind of breaking it down, the conversations that I’ve had, some people are just like, they hope they just kind of push that one off to the side and be like, yeah, we’ll do it as much as we can. But, you know, they shouldn’t be hung up on that part because like he, like John just said, if they come in unconscious, is the family going to be like, yeah, we don’t know if want to pay that. I’m like, seriously, just it’s just one of those things. You just kind of look at that going, why? 

Kendall Jones (11:30)
Yeah, and they’re not going to say, let’s go to a different hospital. Yeah, yeah.

Very true. I think too, the other conversation we had as we were prepping was focused on surgery centers and where they fall within this. And I know John, you had a good example of how surgery centers don’t need to currently comply, but they exist within hospitals. So where does that stand?

Jon Karp (11:56)
Well, right. just personal just happened, right? My 17 year old got their nose broken playing basketball. And so what to go into the surgery center to have the nose reset. They don’t ask any questions. I mean, you don’t they don’t really tell you how much they think it’s going to cost. They’ll tell you what your copay is, right? Metrodeductible or those things. But it’s a surgery center. And it and it’s built separately, even though the surgery centers with in the hospital. It’s not billed as the hospital. It’s billed as XYZ surgery center. And so this doesn’t apply to them as of yet. So which is kind of interesting. And I think more and more procedures for the consumers are being done in surgery centers if they’re day procedures versus true hospitals. Right?

Kendall Jones (12:27)
Mm-hmm.

Yep.

Jolee Patnaude (12:47)
Right? A lot of people feel more comfortable doing them like that.

Kendall Jones (12:53)
Yeah.

Jon Karp (12:53)
It works quicker, it’s faster.

Jolee Patnaude (12:54)
Yeah, you don’t have to deal with all the hospital, well we can’t take you right now, we have such and such going on, so yeah, there’s a lot of that going on.

Kendall Jones (13:03)
Yeah, aren’t there, and I may be wrong in saying this, but aren’t surgery centers often in suburban areas kind of more spread out as well or no trend there?

Jon Karp (13:15)
There’s probably more in the city of Dallas than you can imagine. If go down the tollway, you can see several in the city.

Jolee Patnaude (13:15)
I don’t think there’s a trend, no. Yeah.

Kendall Jones (13:18)
Yeah, yeah, that’s true.

That’s true.

Jolee Patnaude (13:21)
Yeah.

Kendall Jones (13:21)
I was thinking more from like convenience and people just having a surgery center closer to them than a full hospital.

Jolee Patnaude (13:24)
Yeah.

And some of them do specialize, some just do general, and some specialize in orthopedics, some specialize, so yeah, you might see that kind of trend.

Kendall Jones (13:30)
Mm-hmm.

Yeah, very true. Anything more there, Jolee, on the current order or anything that you’d like to add to hospitals complying over the last few years or anything like that?

Jolee Patnaude (13:50)
Yeah, so they did do a update. So right now there are 54 % of the hospitals across the nation that are compliant. so there’s still 46 % as the end of 2024. So at this point, there’s probably a push to get more on board. Some hospitals will just take the hit and do the fine because either they can’t get the IT to work or they just don’t have the ability to update their websites. The biggest thing that kind of kicked off, I do believe the reason why they made it specific as the actual cost is because the data that was collected in the last couple of years of putting this information together was that some hospitals, depending upon how the patient was either brought in or who they were seeing, it doesn’t really go into super detail as to why, but that there was different costs for the same tests, same procedures, same, you know, that type of stuff. So there was a question as to why was this patient charged this, but this patient was charged this other cost. So this is where the estimate, and I’m doing air quotes, the estimate is kind of where the whole, “Did you give the estimate? Is this what the patient wanted? Or is there something that you did for the patient?.” There’s a lot of scenarios that can happen. But actual cost, it should be the same across the board. One patient shouldn’t be 50 bucks because this patient over here has this type of insurance. It’s only 75. So those types of things. So I think that’s what their concern is. And it also is just to make sure that they get to make an educated decision on their care.

A lot of people just, well, I go to this hospital because that’s where I’ve always gone. They don’t double check things. They don’t see that the cost has gone up because just like any other industry, everything has gone up in healthcare also. And I think a lot of people just think that it’s just expensive period and healthcare is expensive. I’m not gonna say any different, but there’s reasons as to why and it’s not just as simple as,

Kendall Jones (15:32)
Mm-hmm.

Jolee Patnaude (16:01)
It’s not a shirt. It’s not a pair of pants. There’s a lot behind the tests that you do There’s a lot behind the pharmaceuticals that you get there’s a lot behind the care that you receive It’s not just somebody walking in going hmm Yeah, it looks like you did something to yourself, and this is what we’re gonna do for you You know it’s it’s not that just let’s try this kind of thing and see what sticks It’s someone who’s actually knowledgeable educated and they’ve spent the time to learn all the different things about the human body and you know, if it’s depending upon what you’re there for, there’s a lot to it. So that’s the reason why some of the cost is higher in some cases. And I know a lot of people don’t understand that, but I mean, like when you buy a car, do you really understand what goes into, you know, putting a car together? I don’t, but you know, sometimes I look at the price going, my God, really? So yeah.

Jon Karp (16:53)
So I was with, I’m on a committee at one of the hospitals, local hospitals, and one of the things they did is they described why the Tylenol cost $100. Like they took us through the spreadsheet of what happens to get the Tylenol to the patient. So you don’t really think about, you just think about the fact that you have the bottle in your medicine cabinet, but you don’t pay attention, okay, there’s a nurse, there’s…tracking, there’s input into a chart that you got it to make sure everybody knows that, at 12 o’clock you got a Tylenol, so you can’t have another one until four more hours. The touching for that one medication is not what you would have at home. And so that’s how come it costs 100 bucks to get it in a hospital versus getting it out of your medicine cabinet. So, and actually just want to key in on one of the components that when Jolee was talking about the fines and the penalties, realized most governmental fines and penalties are not deductible. And so, and they haven’t really ruled whether this would be or not. My gut is it’s not going to be deductible for taxes. And so also recognize is that you have two types of hospitals. You have for-profit hospitals and nonprofit hospitals. Well, if a nonprofit hospital has to pay a fine, well, they’re not, it doesn’t matter anyway. A for-profit hospital has to burn cash without a corresponding tax deduction, that means people are paying tax on that money now. So when you look at a million dollars or you look at two million dollars, you could end up flipping into a taxable situation pretty quick.

Kendall Jones (18:21)
Yeah, good point there.

Jon Karp (18:31)
And then I’d say, think the other, like, I know we’ve, we’ve kind of talked about the patient and I think where this really comes into play for everybody that works with us is we represent some small hospitals. They’re going to have to have, make sure this is in place. And then it’s really also about everybody out there that the whole idea is that like Julie said, that you’re putting the power into the patient. But one of the parts of the transparency is they think it’s going to lower costs because it’s going to create a competition that then us as just patient consumers can go in and say, well, gee, if I can go to a hospital around the corner versus the hospital three miles away, three miles away, it’s going to cost me less. I’m going to go three miles away. And it’s really putting the power with the patient and empowering the patient population. And it used to be that when maternity coverage used to be extra on a policy, like consumers would say, okay, so do I want to buy up into the maternity coverage or how much does it cost me to negotiate with the hospital and have a cash baby? Like I can go in and just write a check to the hospital. And the interesting part is all three of us could have done that and all three of us would have been given a different number at the same hospital because we just, one of us may have been able to negotiate better. And now they’re saying, no, we’re all going to pay the same cash price if we were to go make that phone.

Kendall Jones (19:44)
Yeah, and then you can call three hospitals instead of get three different numbers at the same hospital. Yeah, very interesting. Well, that kind of brings me to our last question here. And when we were prepping, we talked a lot about patient education and how that has an impact here and knowing what your policy covers, knowing what the hospital can and can’t do by way of cost.

Jolee Patnaude (19:54)
Exactly.

Yep.

Kendall Jones (20:19)
Jolee, what would you say for people listening just as patients? I mean, what’s your recommendation to stay educated and what are your thoughts there?

Jolee Patnaude (20:29)
So the biggest thing I think, and this is something that I do stress a lot, ⁓ educating patients is huge. You should understand your plan.

You should understand what you’re paying for. ⁓ A lot of people, you’d be like, what does your plan cover? And they just look at you like, I have no idea. I’m like, did you read your plan? Do you know what your copay is? Do you know? It’s amazing, but a lot of people are like, I don’t even know where look for that. So the part that I love is like, do you have your card? Yes. Look at your card. Cause a lot of insurances will put on there. If you go see like a ⁓ primary care, it’s $15 or $25 copay. ⁓ Or they have a lumber on the back that you can call them and go, yeah, so I’m going to the facility for this or I need to go get an x-ray. How much is this going to be out of my pocket? You can ask these questions and they will tell you. So, I should say they’re supposed to tell you, let’s put it that way. But, you know, read your policies before you sign up for them. Understand what you are covered for, what’s not covered. It amazes me how many people think that, you know, I can go to the chiropractor and then they find out after five visits I have absolutely no coverage for chiropractor. And those are not cheap.

I mean, it is something that everybody thinks they’re covered for because they’re quote unquote a doctor, but it’s like, no, you’re not covered for chiropractic. So there’s all these little things that a lot of people don’t pay attention to. I mean, I’m not talking just young people either. I’ve talked to everybody in all age ranges that have absolutely no clue as to what’s covered and what’s not covered. And the first thing I say is, what’s on your plan? And they’re like, well, I don’t know. Did you get like an updated plan?

Kendall Jones (22:03)
Mm-hmm. ⁓

Jolee Patnaude (22:08)
And a lot of people don’t pay attention. So educate the patient is huge. ⁓ And this could just be from anything from just like call your insurance, go on your, know, every insurance has a website. Most of them have portals that you can sign up for that you can actually sign in, look to see what your coverage is and see if you can get certain things or what your co-pays are. Or when a claim does process from a facility or a doctor, it’ll say right there.

You owe $250 because you went and got a CT scan and this is what you know before you actually get that paper explanation of benefits Or in some cases they put it through their website and you don’t ever get a paper Eob you don’t know that so these are things that people need to make sure that they are Educated on and I’m gonna keep saying educated because that is the key word here and it goes across the board I mean even I mean I work with I’ve been in health care for a really long time and I work with people in healthcare that have no idea what they’re covered for and have no clue what they’re gonna get if they go into you know to see a doctor. I’m not kidding it’s funny I mean I’ve had nurses go why is it this much? I’m like you went and saw the doctor well it shouldn’t be that much but okay.

Jon Karp (23:22)
Right. Well, and realize that even your practitioners or the folks at the front desk, it like we have obviously copays for different things with our firm policy. And it always amazes me that my kids or myself will go to see a specialist and they’ll charge me like a primary physician and they’ll say, no, this is all it is. And I’m thinking you’re going to send me a bill in a month. They don’t even understand, even though they’re supposed to be looking at it, they don’t read the cards correctly either. It’s usually me trying to say, look, why don’t you charge me this amount versus, right? So don’t have to worry about it later. And if you have to me a refund check, great, right? All right. I know I’m going to owe it to you. You’ve done this for two years now. And it’s just an amazing, but so it’s like even that front desk person doesn’t always understand the various policies that the practices are taking and what the true costs are.

Jolee Patnaude (23:53)
Nope.

I’ll pay the little extra right now just in case. Yep, and that comes in with your eligibility checks. yeah, that tells me that they’re not reading it or don’t know how to read it. You’d be surprised if somebody were just like, yep, you got coverage, you’re good. You can go see the doctor. It’s like, what kind of coverage do they have? those are little questions. Yeah, mm-hmm.

Jon Karp (24:24)
Yep.

Kendall Jones (24:27)
Yeah, yeah. What are you going to send me as a surprise in the mail in a few months or weeks?

Jon Karp (24:30)
Right.

Well, and that’s actually what’s like this hospital price transparency to go just kind of funnel us back that way. That’s actually part of this, right? There should be no, like there was a lot of, there’s been a lot of talk and a lot of legislation on no surprise billing and the transparency should really be doing 100 % away from that surprise billing for the day.

Jolee Patnaude (24:53)
Yeah, the No Surprise Act is another one that people are like, what do you mean? Why does that work? So yeah, there’s another one out there that’s very intricate for healthcare that a lot of people don’t understand either.

Kendall Jones (24:54)
Definitely.

Yeah, maybe that’ll be a part two. We can break that down on our next episode. Awesome. Well, we are just about at time. So I appreciate both of you for taking time out of your days to sit and talk through healthcare cost transparency and some of the nuances there with the news and just updates that we’ve seen coming so far in 2025. I’m sure there will be more along the way.

Jolee Patnaude (25:11)
Okay.

Kendall Jones (25:30)
⁓ But for now, we’ll wrap this episode and thank you all for listening. Again, you can subscribe on Spotify, Apple, listen right on WhitleyPenn.com slash podcast. So thank you all.

Jolee Patnaude (25:44)
Have a good day.

Kendall Jones (25:45)
Awesome, thanks guys. And cut.

Jon Karp (25:46)
Good.

Jolee Patnaude (25:47)
Okay.

Jon Karp (25:49)
We’re done!