The Biden administration has caught the attention of the healthcare industry with its plan to fine hospitals up to $ 2 million for violating price transparency rules.
Health systems have been slow to comply with new federal requirements that require them to publicly disclose the prices they charge for medical services, prompting federal officials to increase pressure on them to comply. Many hospitals seem to have taken a wait and see attitude on the rules amid a change of leadership in the White House. But the Biden administration shows no signs of abandoning price transparency.
“It’s not going anywhere,” said Morgan Lewis partner Susan Fagin Harris.
Hospitals are stepping on their heels.
“We are deeply concerned about the proposed increase in penalties for non-compliance, especially in light of significant uncertainty in the interpretation of the rules,” Stacey Hughes, executive vice president of the American Hospital Association, said in a statement.
Since then, usually in effect in January, hospitals have adhered to it everywhere. According to the Patient Rights Advocate’s analysis, more than 80% of the 500 randomly selected hospitals did not publish rates negotiated with third-party payers, half did not disclose any agreed rates at all, and about 40% did not distribute cash discounts. held from May to July. The vast majority of hospitals do not publish all of the agreed rates for specific payers and plans.
Only 6% of hospitals met all the requirements of the rule.
But that could start to change as the CMS clarifies the rules and hospitals fight to avoid the ire of regulators.
“The larger the fine, the more priority it becomes,” said Feigin Harris.
In the proposed rule, the CMS asked the public to comment on best practices for online pricing tools, describing available purchases in plain language, standardizing machine-readable files, and ways to identify and distinguish hospitals that provide price transparency.
The agency may also set new minimum transparency standards for hospitals to avoid penalties in its final rule later this year, said Ann Phelps, head of US health policy and regulation at Deloitte.
Price transparency could escalate into a competition issue after the co-insurer rule takes effect in January. Hospitals can increasingly promote their quality and patient experience along with pricing information, Phelps said.
“Payers will post information,” she said. “Hospitals will want to tell their story.”
Hospitals supported CMS’s plan to end the Trump administration’s controversial phase-out of a list of inpatient-only services, a group of services that Medicare will pay only if they are inpatient because of their medical complexity.
“In addition to the doctor’s opinion, the IPO list serves as an important tool for determining which services are appropriate to provide on an outpatient basis,” America’s Essential Hospitals CEO Dr. Bruce Siegel said in a statement.
They were also thrilled by the agency’s decision to reduce the number of services Medicare allows outpatient surgery centers to provide, portraying it as a mainstay of patient safety.
“Hospital outpatient departments meet higher regulatory standards and are often the best places for patients with the most severe chronic conditions,” Hughes said in a statement.
But hospitals have not yet come out of the woods as the Biden administration is still deciding whether to eliminate or shorten the long-term inpatient-only list. In addition, Medicare may allow outpatient surgery centers to perform more procedures if they meet the agency’s criteria.
“This is not a complete rollback,” Phelps said. “They are probably going to reissue the changes with different criteria and guidelines.”
Regardless, both steps should give health systems more time to prepare for any future changes and ease some of the administrative burden on hospitals in the near future, said Brigitte Kayy-Buffour, deputy director of Avalere Health, a consulting firm.
“There are some provisions in the proposed rule that take into account financial and financial considerations for service and equipment providers,” she said.
Hospital groups and many experts have opposed the termination of the hospital-only patient list, arguing that this could compromise quality and safety as many procedures are high-risk. Hospitals were also worried about how this move would affect their finances, as it would likely lead to more treatments in cheaper conditions.
“When a procedure is dropped from an IPO, it typically brings in healthier Medicare beneficiaries with shorter stays, whose treatment is transferred to the hospital outpatient department, leaving more sick and more difficult patients inpatients,” the AHA said. comments on the outpatient payment rule proposed last year.
But the Trump administration argued that the quality and safety concerns were exaggerated: former CMS administrator Sima Verma noted at the time that commercial payers were already paying for such services outside the hospital.