Media & Insights

KABOOM! Biden HHS Proposes Smack-Down on Price-Hiding Hospitals

Today, the Biden Centers for Medicare and Medicaid Services (CMS) proposed a series of tough measures to crack down on hospitals that are brazenly flouting rules, in effect since January 1, requiring posting of previously secret negotiated and cash prices for every item and service they provide to patients.

As part of the proposed annual Medicare payment rule for outpatient facilities, CMS proposed an increase on the laughably negligible civil monetary penalty of $300 per non-compliant day to $10 per bed per noncompliant day, for all hospitals with more than 30 beds. The penalties are capped at $5,500 per day, an annual max of just over $2 million.

Honestly, for giant corporate hospital systems, $2 million is equivalent to the reimbursement for a few ICU/NICU episodes, so it’s still too low. But the important thing here is that Team Biden is doubling way down on the Trump price transparency rules in a meaningful way. The White House signaled as much in last week’s executive order on competition in the economy, by ordering HHS to “support” the price transparency rules. But coming out in such short order with proposals to beef up enforcement – precisely the policy advocated here at AllBetter Health – is a major step in the right direction.

The proposal puts the kibosh on a number of games that hospitals are playing to try to prevent patients, employers and aggregators and app developers from finding their price data, including blocking full API access, imposing barriers to inhibit search engines from finding them, burying the files under a mountain of clicks and navigation, and so forth. The proposed rule also smacks down the outrageous behavior by hospitals to make it near impossible to get info on “shoppable” services through an out-of-pocket estimator tool, by allowing queries only to users who input burdensome, often personally identifiable data in order to see the price estimate. They also return “estimated price ranges” in their estimator tools instead of, you know, the actual price.

CMS asks the public if we think the penalties for noncompliance should be even higher (um, yes), and if there are extreme circumstances where a hospital out of compliance shouldn’t be held accountable (well, maybe if during those extreme circumstances, like a hurricane, they also charged no more than 200% Medicare, didn’t balance bill, and didn’t send anyone to collections or lawsuits. Patients have some “extreme circumstances” too, like cancer, and injuries, and $10,000 deductibles, and they don’t get any grace from price-gouging hospitals).

For now, these are merely proposals, and CMS is asking for public comment on them over the next 60 days. It is critical that employers, benefits advisors, unions and patients – who are the primary consumers of transparent prices – make their voices heard. Agencies are required by law to respond to all the comments they receive, and so it is truly a meaningful way for the public to influence what CMS ultimately finalizes. We at AllBetter will be submitting comments and we enthusiastically commend the Biden administration for taking our right to know health care prices seriously and for this significant escalation of intolerance toward patient financial abuse.

Submit your comment in support of the tougher enforcement on non-complying hospitals.

Read the fact sheet about the proposal.

Read the actual proposal, pp. 731 – 760 (preamble/summary), pp. 860 – 862 (reg text)

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