Hospitals are increasing compliance with price transparency rules, according to a report by Turquoise Health. More than 84% of hospitals have published pricing data as of Q1 2023, compared to 65% in Q4 2022. However, many hospitals are still not following the requirements, and Families USA has recommended that CMS and Congress improve enforcement and oversight strategies, establish a standardized data format, and require quality data to be disclosed with the pricing data. The report also suggests that price transparency information should be available in languages other than English to increase accessibility.
In January 2021, the Centers for Medicare and Medicaid Services (CMS) implemented the hospital price transparency rule, requiring hospitals to post their standard charges for all items and services on their websites in a machine-readable format. The goal of the rule is to increase transparency and empower consumers to make informed decisions about their healthcare.
According to a Turquoise Health analysis, provider compliance has grown in the two years since the rule’s implementation. Some studies, however, have stressed that many hospitals are still not adhering to the regulations. This essay analyses the Turquoise Health report and Families USA’s suggestions for enhancing compliance with the hospital price transparency requirement.
Turquoise Health’s Price Transparency Impact Report
Turquoise Health’s Price Transparency Impact Report for Q1 2023 examines how price transparency compliance has changed since October 2022. The report found that more than 84 percent of hospitals have published pricing data as of Q1 2023, compared to 65 percent in Q4 2022. Over 5,300 hospitals had a machine-readable file, up from less than 2,000 during the first quarter of 2021.
Among 6,394 hospitals, 73.6 had negotiated rates posted and 70.6 percent had cash rates. Around three in four hospitals had surgery rates and imaging rates publicly available. Turquoise Health determines hospital compliance using its price transparency scorecard.
Five stars indicate that a hospital has a complete machine-readable file that contains cash, a list, and negotiated rates for a significant quantity of items and services. Four stars are awarded to a hospital that has a machine-readable file that is largely comprehensive and demonstrates an effort to satisfy the standards, but there is still space for improvement.
Three stars indicate a partially complete machine-readable file that has some useful information but is still missing crucial elements, and two stars signify an incomplete machine-readable file with data that would not be useful to patients. Almost 60 percent of hospitals received five stars and 24 percent received four stars. Only 7 percent of hospitals were issued three stars and 12 percent received two stars.
Families USA’s Recommendations on Improving Hospital Price Transparency Rule Compliance
Despite the Turquoise Health report showing progress with price transparency compliance, Families USA has offered recommendations to CMS and Congress is working to better enforce the rule requiring hospital price transparency.
By adopting and mandating a consistent data format, CMS should check that the information on pricing transparency is helpful to consumers. CMS should specifically demand that hospitals utilize real costs in dollars and cents, a consistent file structure for machine-readable data that can be examined by both machines and people, a standard code format for services, and a standard format for payer data.
CMS should also require hospitals to publish prices for a determined set of high-cost, high-volume services provided in inpatient and outpatient settings and require quality data to be disclosed with pricing data. In addition, price transparency information should be available in languages other than English to increase accessibility.
The report also recommended that CMS improve enforcement and oversight strategies. For example, the agency should issue civil monetary penalties to non-compliant hospitals and remove the $2 million cap on fines. CMS should prevent hospitals from posting a price estimator tool instead of posting actual negotiating rates to help limit consumer confusion. Additionally, the report suggested CMS provide quarterly updates on the number of warning letters, corrective action plans, and penalties issued with hospital names.
The report called on Congress to conduct hearings and oversight activity to identify low hospital compliance. Congress should also codify a hospital price transparency rule into law that incorporates the recommendations to CMS.