Health

Hospitals largely do not respect the rule of price transparency

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Affiliate and private systems, nonprofit hospitals, were more likely to provide data in a consumer-friendly format than independent and public hospitals. For-profit hospitals were more likely to abide by the rule than public hospitals.

Specific negotiated rates for payers, which are the prices that hospitals agree to charge individual insurance companies for patient care, were the least likely to be publicly disclosed by hospitals in the study.

“It’s not so surprising. This is by far the most sensitive information [and] the product of a negotiation between an insurer and a hospital, ”Abraham said.[It] it’s been typically guarded and private until now. ”

The industry has been fighting the rule since it came into force.

Lovisa Gustaffson, vice president for controlling health care costs at the Commonwealth Fund said hospitals wanted to protect fee rates from patients, employers, researchers and other members of the public, perhaps to give itself a competitive advantage.

While the transparency is mandated by the government, Rick Kes, a healthcare professional at US consulting firm RSM, said many hospitals understand that it is primarily driven by consumer interest.

“You hear a lot of people say,‘ When I go to a restaurant, they don’t tell me what the price of a steak is after I eat it, they tell me before I eat it, ’” Kes said. “Why doesn’t that happen in health? “”

He said that, given the complexity of payment and how the financial model of healthcare has worked for years, it is not as easy as it seems to move to a model of price transparency.

Because of the pandemic and other administrative burdens, Kes said some health systems have chosen to become compliant with the rule later in the year so as not to jeopardize their operations.

“It wasn’t necessarily that they didn’t want to respect price transparency … it just wasn’t at the top of their list to be respected, since the penalty if assessed wasn’t really significant,” he said.

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In an email, a CMS spokesman said the agency checks the hospital’s websites, reviews complaints and issues warning letters to hospitals that do not meet the requirements, which it initiated in April.

After receiving a warning letter, hospitals have 90 days to deal with their findings of non-compliance. If non-compliance is not addressed within the 90-day window, the hospital may send a second letter of warning or a request for a corrective action plan.

The federal rule also says hospitals found that they are not in compliance can be fined $ 300 per day, up to about $ 100,000 per year. In total, only about 5% of hospitals failed to meet all of the regulatory requirements that Abraham said.

In general, hospitals seem more inclined to provide prices for non-urgent services, such as an MRI or a therapy appointment, where consumers would have time to keep prices down, he said.

“CMS, I think, wants to encourage reporting,” Abraham said. “They seem willing now to partner with hospitals and [give] they have the opportunity to make a plan for how the data will be produced and put online. ”

“I hope the government stops the course of pushing this agenda,” said Dr. John Cherf, Lumere’s chief medical officer. “It’s one of the best opportunities to control healthcare costs.”

Cherf said price transparency will influence different institutions both positively and negatively and help suppliers better understand their cost structure.

Large hospitals assume the most risk with price transparency, he said, while private practice and outpatient settings will be considered “winners” in this scenario.

In the end, they would like to see more price transparency at the physician level and in independent outpatient facilities such as imaging facilities or outpatient surgery centers, and procedure centers.


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