Hospitals and Health Systems Are Working to Implement Price Transparency Policies and Help Patients Understand Costs

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Hospitals and Health Systems Are Working to Implement Price Transparency Policies and Help Patients Understand Costs
Matthew Diener
Jun 16, 2022

Understanding potential costs is an important part of the patient experience when planning for care, and hospitals and health systems are committed to helping patients navigate that process. That is why the field is developing and deploying tools to help patients get the information they need. Hospitals also have policies in place to assist patients who cannot pay for part or all of the care they receive.

The AHA is supporting this activity by highlighting tools that aid patients and align with the new federal price transparency policy. The first requirement of the policy includes a provision around “shoppable services” that can be met through the use of a patient cost estimator tool, an approach that has been widely adopted. Hospitals and health systems have been able to increase adoption of these tools due largely to growth in the availability of technological resources at multiple price points and with increased functionality. In particular, this “next generation” of price transparency tools are easier for hospitals to implement and for consumers to navigate.

The second hospital price transparency rule requirement, compiling large machine-readable files of all the rates negotiated with health insurers, continues to pose challenges in terms of cost and complexity. These files add little to no direct benefit to patients, who have made clear in their requests to hospitals and health systems that they are most interested to know what they will actually have to pay.

Complicating this further was the need for hospitals and health systems to prioritize responding to COVID-19 surges and vaccine administration. These efforts required significant staff time during much of 2021, resulting in further challenge and, in some cases, delays in the publication of machine-readable files.

The Centers for Medicare & Medicaid Services (CMS), the federal agency responsible for enforcement, has worked with many AHA members to navigate these challenges and help them achieve compliance. AHA members report appreciating the opportunity to work through these details with CMS in a collaborative way.

While hospitals press forward to help patients understand their anticipated costs for care, some outside groups are taking this opportunity to mischaracterize what is happening in the field. These groups ignore CMS’ guidance on aspects of the rule, such as how to fill in an individual negotiated rate when such a rate does not exist due to patient services being bundled and billed together. In this instance, CMS has said a blank cell would be appropriate since there is no negotiated rate to include. In spite of this, some outside groups still count any file with blank cells as “noncompliant.” This is a fundamental misrepresentation of the rules.

As a result, these organizations have reached wildly different conclusions about the status of implementation across the hospital field. Patient Rights Advocate, for example, claims only 14% of hospitals are compliant, while a Milliman analysis found a compliance rate of 68%. CMS, the only true arbiter, has indicated about 160 hospitals remain out of compliance, a much smaller number than either the Patient Rights Advocate or Milliman reports suggest.

The AHA strongly cautions against buying into misguided “assessments” of hospital compliance with the price transparency rule. Hospitals are working hard to provide accurate financial estimates for patients. This is challenging work and requires consideration of both hospital rates and patients’ health care coverage.

We appreciate CMS’ continued commitment to work with hospitals toward compliance, and the AHA will continue to seek opportunities to work constructively and serve as a resource for members and CMS with the goal of getting patients the best possible information.

Ariel Levin is AHA’s director of coverage policy.

Ariel Levin
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