According to new information released by the Centers for Medicare & Medicaid Services (CMS), on July 29, 2019, the agency has proposed policies that it says follows directives in a presidential Executive Order, entitled “Improving Price and Quality Transparency in American Healthcare to Put Patients First,” that lay the foundation for a patient-driven healthcare system by making prices for items and services provided by all hospitals in the United States more transparent for patients so that they can be more informed about what they might pay for hospital items and services.
CMS asserts that the proposed polices in the CY 2020 OPPS/ASC Payment System proposed rule would further advance the agency’s commitment to increasing price transparency, (including proposals for requirements that would apply to each hospital operating in the United States). Hospitals would be required to make public all hospital standard charges for all items and services provided by the hospital in a digital and machine-readable file posted online. They would also make public the payer-specific negotiated charge for a limited set of ‘shoppable’ services that are displayed and packaged in a consumer-friendly manner.
In response, the American Hospital Association, America’s Essential Hospitals, the Association of American Medical Colleges, the Children’s Hospital Association, and the Federation of American Hospitals have released a joint statement that says the rule is a misguided attempt to improve price transparency. Below is the joint statement:
“Hospitals and health systems want to ensure that patients have access to information they need to choose their healthcare, including their out-of-pocket obligations. This rule, however, is a misguided attempt to improve price transparency for patients because it fails to give them the information they need. Disclosing the negotiated rate between insurers and hospitals will not help patients make decisions about their care. Instead, this disclosure could harm patients by reducing patient access to care. This is the wrong approach to price transparency, and the administration should reverse course on this provision.”
CMS is proposing hospitals do the following:
· Display payer-specific negotiated charges for at least 300 shoppable services, including 70 CMS-selected shoppable services and 230 hospital-selected shoppable services. If a hospital does not provide one or more of the 70 CMS selected shoppable services, the hospital must select additional shoppable services such that the total number of shoppable services is at least 300.
· Include charges for services that the hospital customarily provides in conjunction with the primary service that is identified by a common billing code (e.g. Current Procedural Terminology (CPT)/ Healthcare Common Procedure Coding System (HCPCS)/ Diagnosis-Related Group (DRG).
· Make sure that the charge information is displayed prominently on a publicly available webpage, clearly identifies the hospital (or hospital location), easily accessible and without barriers, and searchable.
· Update the information at least annually.
Premier, Inc.'s Blair Childs, Senior Vice President of Public Affairs, also made a statement in reaction to the proposal regarding price transparency: “Premier is committed to quality and price transparency. We are, however, concerned with requirements to publicly post standard charges and payer-specific negotiated rates. This policy fails to address consumers’ information needs to truly understand price, including information on copays and deductibles. Moreover, disclosing payer negotiated rates harms health systems’ negotiating power, creating anti-competitive market distortions.”
Vizient voiced similar disappointment in a public statement: "Vizient and its member hospitals support efforts that help ensure patients have access to information they need to make informed decisions about their health care, including their out-of-pocket obligations. However, we believe that disclosing the negotiated rate between insurers and hospitals will not accomplish that goal and could, ultimately, have the effect of limiting access to care and driving up prices. Vizient supports meaningful price transparency efforts that will not discourage patients from seeking needed care due to potentially misleading cost information. We believe this is the wrong approach to price transparency, and the administration should reverse course on this provision in the final OPPS rule."