The price transparency rule requires U.S. hospitals to make their prices available to the public. Only 14 percent of hospitals are in compliance.
The Centers for Medicare & Medicaid Services (CMS) has sent its first warning letters to hospitals that have violated federal rules requiring them to disclose payer-negotiated prices.
Although a Trump-era price transparency rule took effect almost two years ago, many hospitals have not complied with requirements and they post the prices for common goods and services online.
The rule requires hospitals to publish discounted cash prices for services and payer-specific negotiated rates for uninsured patients. Additionally, hospitals are required to post price data on their websites for selected services, such as scheduled X-rays in advance.
According to data from 100 random hospitals, 33 reported their payer-specific negotiated rates, and 30 reported their discounted cash prices in a machine-readable format. From a total of 52 facilities posted a price estimator tool for shoppable services, with 23 providing payer-specific negotiated rates in a structured format.
Patients have to leverage specific tools to input their insurance data before receiving a price estimate, while discount cash prices can view without plan data. Compliance may be limited because the penalties for non-compliance are small and the costs of the disclosure are potentially high.
For example, employers could use the information to reward high-quality providers and remove low-quality providers from their networks.
The researchers also looked at high-paying facilities, where the administrative costs of being in compliance should be small, but disclosure could still push employers and patients to find less expensive services of the 100 highest-revenue hospitals, only 35 reported payer-specific negotiated rates and 40 reported cash prices in machine-readable formats. 86 facilities offered a price estimator tool, of which 34 posted payer-specific rates in machine-readable formats.
100 hospitals with the highest reimbursement rates refused to disclose their prices for all services, even though the price estimator tool requires this information to be visible. This is because clients may view the price only for a given patient and insurance plan and not the public. Therefore, selective compliance may fail to expose backdrops of market power or support a broad analysis of price variation.
Researchers said even if compliance increases over time, early selective compliance suggests that reluctance may persist. They suggest central considered stiffer penalties, additional technical assistance, or public reporting of non-compliance.
Conclusion
However, despite being a year into the implementation of the rule, all hospitals have a long way to go in order to keep up with the rest of the industry. The government is committed to price transparency and hopefully, they will continue to set the example and encourage more hospitals to follow the price transparency rule.
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