Price transparency in the US healthcare industry
Image: KFF
This month, a new Virginia law requiring hospitals to make costs for their procedures publicly available or face a minimum six-figure fine officially took effect.
Or as Jerry Maguire said: “Show me the money-related costs!”
State legislators introduced the first-of-its-kind bipartisan bill after receiving complaints from citizens and rights groups that many Virginia hospitals weren’t properly complying with a Trump administration law requiring all US hospitals to publish their prices online in two formats:
- A “shoppable” list of at least 300 services in a consumer-friendly format
- One that can be easily read by other computer systems (allowing web developers and consumer groups to create tools for patients)
And when it comes to how well Virginia hospitals and America as a whole are really complying with the price rule, it all depends on how you define “comply.”
A February 2023 analysis by the Centers for Medicare & Medicaid Services (CMS) – the federal agency tasked with enforcing the Trump-era price transparency rule – found 70% of the ~6,000 hospitals in the US had met their obligation to publish both lists as of five months ago. That’s up from 27% in a similar study conducted in 2021.
- As of this April, CMS had issued 730 warning notices, submitted 269 requests for a corrective action plan, and fined four hospitals a collective $1.3 million for noncompliance with its new federal price transparency law.
✋ On the other hand… A separate February 2023 analysis published by Patients Rights Advocate found less than 25% of US hospitals were fully compliant with the requirements in the Trump-era transparency law.
- This study, based on data from 2,000 US hospitals, found that while many hospitals had published both required lists of information online, their data was often incomplete, illegible, or not clearly associated with specific health plans and insurers.
📸 Big picture: On average, the top 100 largest hospitls in the US charge 7x the actual cost of the care they provide, per a June 2021 study from Johns Hopkins University.
đź“Š Flash poll: Would you support a harsher punishment for hospitals that fail to comply with federal laws requiring full price transparency?
See a 360° view of what media pundits are saying →
Sprinkles from the Left
- Some commentators argue that at any other place of business besides hospitals, it would be ridiculous to expect consumers to receive a product without knowing its price – and healthcare should be no different.
- Others contend that America’s health insurance industry would be greatly improved if patients were able to shop around and get the best price on all of their medical services.
- “Hospital pricing gouges patients” –USA Today Editorial Board
- “Health insurance makes many kinds of hospital care more expensive” –Ge Bai and Cynthia Fisher, WaPo
- “Virginia Leads the Way on Medical Price Transparency” –Virginia state Rep. Dan Helmer (D)
Sprinkles from the Right
- Some commentators argue that America’s ongoing lack of price transparency is a main reason why the US is paying more per capita for healthcare than any other developed nation.
- Others contend that healthcare price transparency is a rare bipartisan issue in today’s era of hyperpartisanship, and should be embraced to its fullest extent by sitting US lawmakers.
- “A lack of price transparency is one reason health care costs so much” –Las Vegas Journal-Review Editorial Board
- “Health Care Price Transparency—A Golden Opportunity for Real Change“ –David N. Bernstein and Robert E. Moffit, Newsweek
- “Price Transparency: A Boon For Patients, A Bust For Hospitals?” –Seth Joseph, Forbes
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