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Over- and underreporting of prices: most hospitals are not compliant with the Hospital Price Transparency Rule.

ABSTRACT: Concern has been raised about the effectiveness of the Hospital Price Transparency Rule to facilitate a clear understanding of health care prices due to poor reporting by hospitals. However, the relationship between what services the hospital provides and what prices they report is not clear. We assessed reported prices in the Turquoise Health database and compared them at the hospital level with the CMS Provider of Services File to identify if a shoppable service was provided at a hospital. We found significant mismatch between the hospital prices being reported and the services being provided. For example, 56% of hospitals providing at least 1 shoppable service that requires public price reporting did not report any prices. Of hospitals reporting prices, most hospitals (66%) reported prices for only a portion of the services they provide. In addition, 12% of hospitals reported prices for services they do not provide. Only 6% of hospitals had complete concordance with price reporting and services they actually provide. Current compliance enforcement and penalties do not appear to be adequate to achieve the goals of the Hospital Price Transparency Rule.

SUBMITTER: Mead M

PROVIDER: S-EPMC11363865 | biostudies-literature | 2024 Sep

REPOSITORIES: biostudies-literature

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Over- and underreporting of prices: most hospitals are not compliant with the Hospital Price Transparency Rule.

Mead Mitchell M Ibrahim Andrew M AM

Health affairs scholar 20240819 9

Concern has been raised about the effectiveness of the Hospital Price Transparency Rule to facilitate a clear understanding of health care prices due to poor reporting by hospitals. However, the relationship between what services the hospital provides and what prices they report is not clear. We assessed reported prices in the Turquoise Health database and compared them at the hospital level with the CMS Provider of Services File to identify if a shoppable service was provided at a hospital. We ...[more]

PMID: 39220579

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Project description:ObjectiveTo understand US hospitals' initial strategic responses to the federal price transparency rule that took effect January 2021.Data sources and study settingPrimary interview data collected from 12 not-for-profit hospital organizations in six US metropolitan markets. All but one organization were multihospital systems; the 12 organizations represent a total of 81 hospitals.Study designExploratory, cross-sectional, qualitative interview study of a convenience sample of hospital organizations across six geographically and compliance diverse markets.Data collection/extraction methodsIn-depth, semi-structured, qualitative interviews with 16 key informants across sampled organizations between November 2021 and March 2022. Interviews solicited data about internal organizational factors and external market factors affecting strategic responses. Transcribed interviews were de-identified, coded, and analyzed using the constant comparative method.Principal findingsHospitals' strategic responses were influenced internally by the degree of the regulation's alignment with organizational values and goals, and task complexity vis-a-vis available resources. We found extensive variation in organizational capabilities to comply, and all but one organization relied on consultants and vendors to some degree. Key external factors driving strategic responses were hospitals' variable perceptions about how available price information would affect their competitive position, bottom line, and reputation. Organizations with more confidence in their interpretation of the environment, including how peers or purchasers would behave, and greater clarity in their own organization's position and goals, had more definitive initial strategic responses. In the first year, organizations' strategic responses skewed toward compliance, especially for the rule's consumer shopping requirements.ConclusionsA deeper understanding of the realities of operationalizing price transparency policy for hospitals is needed to improve its impact.

Project description:ImportancePrice transparency regulations aim to help patients make informed decisions about medical care, but enforcing these rules is a policy challenge. There may be an association between financial penalties and hospital compliance for enforcing price transparency regulations.ObjectiveTo evaluate the association between financial penalties and acute care hospital compliance with the 2021 Centers for Medicare & Medicaid Services (CMS) Price Transparency Rule.Design, setting, and participantsThis cohort study uses an instrumental variable design to evaluate the responses of 4377 acute care hospitals in the US operating in 2021 and 2022 to changes in financial penalties in the context of a federal rule requiring hospitals to disclose privately negotiated prices.ExposureChanges in noncompliance penalties between 2021 and 2022 based on a nonlinear function of bed counts.Main outcomes and measuresWhether hospitals publicly posted a machine-readable file with private, payer-specific negotiated prices at the service-code level. Negative controls were used to address confounding.ResultsThe final sample included 4377 hospitals. Compliance increased from 70.4% (n = 3082) in 2021 to 87.7% (n = 3841) in 2022, with 90.2% of hospitals (n = 3948) reporting prices in at least 1 year. Noncompliance penalties increased from $109 500/y in 2021 to a mean (SD) of $510 976 ($534 149)/y in 2022. Penalties in 2022 were substantial, averaging 0.49% of total hospital revenue, 0.53% of total hospital costs, and 1.3% of total employee wages. Compliance increases were significantly positively correlated with penalty increases: a $500 000 increase in penalty was associated with a 2.9-percentage point (95% CI, 1.7-4.2 percentage points; P < .001) increase in compliance. Results were robust to controlling for observable hospital characteristics. No associations were found for preperiod (2021) compliance or ranges of bed counts where penalties do not vary.Conclusions and relevanceIn this cohort study of 4377 hospitals, compliance with the CMS Price Transparency Rule was associated with increased financial penalties. These findings are relevant for the enforcement of other regulations designed to promote transparency in health care.

Project description:BackgroundThe Hospital Price Transparency Final Rule, effective January 1, 2021, requires hospitals to post online a machine-readable file that includes payer-specific negotiated commercial prices for all services. The regulation aims to improve the affordability of hospital care by promoting price competition. However, a low compliance level among hospitals would compromise the operational effectiveness of this regulation. Understanding hospitals' compliance status to the regulation has important implications for its enforcement effort and effectiveness assessment.ObjectiveTo analyze nationwide hospitals' compliance status to the Hospital Price Transparency Rule.DesignCross-sectional observational study.ParticipantsA total of 3558 Medicare-certified general acute-care hospitals were examined.Main measuresA binary compliance rating was generated by using data collected by Turquoise Health. "Noncompliance" means that no machine-readable file was posted or the posted file contains no commercial negotiated prices. "Compliance" means that a machine-readable file was posted with commercial negotiated prices for at least one insurance plan.Key resultsAs of June 1, 2021, 55% of the 3558 Medicare-certified general acute-care hospitals we examined had not posted a machine-readable file containing commercial negotiated prices. Wide variations of compliance existed across states and hospital referral regions. A hospital's compliance status is strongly associated with the average compliance status of peer hospitals in the same market. Hospitals with greater IT preparedness, for-profit hospitals, system-affiliated hospitals, large hospitals, and non-urban hospitals had greater compliance. More concentrated hospital markets had greater average compliance.ConclusionsHospitals take into consideration the behavior of their peers in the same market when making price disclosure decisions. Compliant hospitals are likely to have better IT preparedness, more financial resources and personnel expertise to mitigate the cost required for the implementation of the Price Transparency Rule. The compliance cost, therefore, might be a barrier for some hospitals.

Project description:ImportancePatients with urologic diseases often experience financial toxicity, defined as high levels of financial burden and concern, after receiving care. The Price Transparency Final Rule, which requires hospitals to disclose both the commercial and cash prices for at least 300 services, was implemented to facilitate price shopping, decrease price dispersion, and lower health care costs.ObjectiveTo evaluate compliance with the Price Transparency Final Rule and to quantify variations in the price of urologic procedures among academic hospitals and by insurance class.Design, setting, and participantsThis was a cross-sectional study that determined the prices of 5 common urologic procedures among academic medical centers and by insurance class. Prices were obtained from the Turquoise Health Database on March 24, 2022. Academic hospitals were identified from the Association of American Medical Colleges website. The 5 most common urologic procedures were cystourethroscopy, prostate biopsy, laparoscopic radical prostatectomy, transurethral resection of the prostate, and ureteroscopy with laser lithotripsy. Using the corresponding Current Procedural Terminology codes, the Turquoise Health Database was queried to identify the cash price, Medicare price, Medicaid price, and commercial insurance price for these procedures.ExposuresThe Price Transparency Final Rule, which went into effect January 1, 2021.Main outcomes and measuresVariability in procedure price among academic medical centers and by insurance class (Medicare, Medicaid, commercial, and cash price).ResultsOf 153 hospitals, only 20 (13%) listed a commercial price for all 5 procedures. The commercial price was reported most often for cystourethroscopy (86 hospitals [56%]) and least often for laparoscopic radical prostatectomy (45 hospitals [29%]). The cash price was lower than the Medicare, Medicaid, and commercial price at 24 hospitals (16%). Prices varied substantially across hospitals for all 5 procedures. There were significant variations in the prices of cystoscopy (χ23 = 85.9; P = .001), prostate biopsy (χ23 = 64.6; P = .001), prostatectomy (χ23 = 24.4; P = .001), transurethral resection of the prostate (χ23 = 51.3; P = .001), and ureteroscopy with laser lithotripsy (χ23 = 63.0; P = .001) by insurance type.Conclusions and relevanceThese findings suggest that, more than 1 year after the implementation of the Price Transparency Final Rule, there are still large variations in the prices of urologic procedures among academic hospitals and by insurance class. Currently, in certain situations, health care costs could be reduced if patients paid out of pocket. The Centers for Medicare & Medicaid Services may improve price transparency by better enforcing penalties for noncompliance, increasing penalties, and ensuring that hospitals report prices in a way that is easy for patients to access and understand.

Dataset Information

Over- and underreporting of prices: most hospitals are not compliant with the Hospital Price Transparency Rule.

Publications

Over- and underreporting of prices: most hospitals are not compliant with the Hospital Price Transparency Rule.

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