Check progress on hospital pricing transparency

For decades, U.S. hospitals have often discouraged patients from wanting to know the cost of their care in advance. Now that is changing – but there is a heated debate about what the hospital is revealing.

Under one Federal law in force As of 2021, hospitals across the country have worked hard to post a mountain of data online outlining their prices for every service, drug, and item they offer, including the actual price they charge. they negotiated with insurance companies and how much cash the patient would have to pay. charged. They did so reluctantly and only after losing a federal rule-challenging lawsuit.

How well they are doing depends on who you ask.

The rules to draw back the curtain opaque hospital prices can vary from hospital to hospital for the same service or even within the same hospital. The expectation is that price transparency will promote competition, giving consumers and employers a way to compare prices and make informed choices, ultimately reducing the cost of care. Whether that will happen remains unclear.

Major insurers and employers are also required to list negotiated prices with all of their providers, under separate rules that went into effect last summer.

Hospitals have made “remarkable progress,” according to one analysis by the Federal Centers for Medicare & Medicaid Services of 600 randomly selected hospitals published in the journal Health Affairs last month. The agency looked at whether hospitals were meeting their obligation to post pricing information online in two main formats: “purchasable” listings of at least 300 consumer services, and machine-readable comprehensive file includes all services for which the hospital charges a standard fee. This file must be in a format that allows researchers, regulators, and others to analyze the data.

CMS found that 70% of hospitals have published both lists by 2022. An additional 12% have published one list or the other. In contrast, the agency’s previous progress review for 2021 found that only 27% of the 235 hospitals had both types of listings.

The 2022 analysis “shows a marked improvement,” says Dr. Meena Seshamani, deputy administrator and director of the Centers for Medicare at CMS, in a statement. But she also said progress is still “insufficient” and CMS will continue to use “enforcement activities and technical support” to get all hospitals “fully compliant with the law”.

The American Hospital Association said the CMS review demonstrated the progress hospitals have made in very difficult circumstances as they grapple with the covid-19 pandemic.

“These are complex policies in effect at the most complicated time in the history of hospitals,” said Molly Smith, trade association vice president of policy. “And we’ve seen an increase in compliance over the past 18 months.”

However, some groups that have looked at the list price data of hospitals are less optimistic. In an analysis published last month, Advocating for Patient Rights checked a list of 2,000 hospitals and found that only 489 of them, 24.5% of the total, complied with all requirements of the rule. An earlier analysis in August 2022 found that 16% met all requirements.

The advocacy group’s analysis includes not only the two types of listings that CMS looks for, but also checks to see if hospitals include required data on specific standard charges for every service provided. , such as gross fee or “chargemaster” prior to applying any discount, the discounted cash price and the insurance company’s negotiated fee.

Cynthia Fisher, founder and president of Patient Rights Advocacy, which promotes transparency about healthcare pricing, said that although most hospitals have published the files online, but the data is often incomplete, illegible, or unambiguously related to specific health plans or insurance companies.

“As hospitals continue to post incomplete files with many missing prices, patients are unable to accurately compare prices between hospitals and between plans to make healthcare decisions,” Fisher said. your best health and protect yourself from being overcharged. Such hospitals were considered non-compliant in the PRA analysis.

The the hospital association is at fault Analysis of the PRA. Terry Cunningham, policy director at the AHA, said the contracts hospitals have with health plans vary considerably from place to place and pricing is not always based on a simple amount. . They can be based on a service plan or based on quantity, he said.

“It’s frustrating and problematic that these other organizations are weighing, saying, ‘This box can’t be left blank,'” Cunningham said.

in them 2020 lawsuitThe hospitals argued that they were not required to disclose their own negotiated rates and argued that doing so would embarrass patients and lead to anti-competitive behavior by insurers.

Last summer, price transparency requirements went into effect in the field of health insurance at the same time, supplementing and providing a cross-reference tool for what the hospital has posted. Insurer transparency requirements are even broader than those for hospitals: Insurers and self-funded employers must list any negotiated rates that they can negotiate with. they have with every doctor, hospital, and other health care provider.

Some critics argue that the data is also not user-friendly. Senators Maggie Hassan (DN.H.) and Mike Braun (R-Ind.) sent a letter next March 6 CMS Administrator Chiquita Brooks-LaSure encourages agencies to take steps to fix “technical vulnerabilities” such as large files and lack of standardization that make it difficult to use the data they are reporting.

That’s where pricing platforms like Turquoise Health come in. The data available from hospitals and insurance companies is a huge treasure trove the company is tapping into to create user-friendly tools that consumers and businesses can use to explore and compare prices.

In its own analysis of the effectiveness of hospital price transparency efforts in the third quarter of 2022, Turquoise Health found that 55% of the more than 4,900 acute care hospitals posted readable files. Machines are “full,” meaning they posted cash, listings, and negotiated rates for a “significant amount” of items and services. 24% of hospitals are rated as “nearly complete”. (Analysis does not evaluate the second type of post, the list of purchasable services.)

Based on Chris SevernCo-founder and CEO of Turquoise Health, which uses a 60-variable scoring algorithm to assess the completeness of hospital records.

“What you get is a more detailed look at these files, hopefully weighing the shades of gray,” says Severn, rather than a simple pass-fail rating.

Regardless of differences in how hospital disclosures are assessed, experts generally agree that CMSs should require that data be reported in a standard format for ease of comparison and enforcement. CMS has developed a template, but hospitals are not required to use it.

Experts say that for price transparency to be effective, enforcement also needs to be consistently concerned. The Biden administration has increased the maximum potential fine to more than $2 million annually per hospital for 2022. Last year, however, CMS fined only two hospitals for non-compliance even though 30% of hospitals failed to respond. The application requested to post both machine-readable files of prices as well as an purchasable listing.

Seshamani said CMS has provided technical support to many hospitals to help them comply, while also planning for stronger enforcement actions.

She said the agency will “continue to accelerate” the timeframe that hospitals must fully comply with after submitting a corrective action plan, which indicates they have failed to meet some of the posting requirements. post. “CMS also plans to take active additional steps to identify and prioritize action against hospitals that don’t upload files at all,” she said.


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