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Lawmakers Raise Compliance Concerns Over Hospital Price Transparency Rules, Request Increased Enforcement


On April 13, 2021, four key lawmakers in the U.S. House of Representatives wrote to the U.S. Department of Health and Human Services (HHS) expressing concern over reports of non-compliance with hospital price transparency rules that went into effect earlier this year. The Centers for Medicare & Medicaid Services (CMS) regulations published in November 2019 require hospitals to publicly report information regarding their standard charges, including privately negotiated charges with commercial health insurers, effective January 1, 2021. The letter from bipartisan leaders of the House Energy and Commerce (E&C) Committee urges HHS to increase enforcement of the price transparency rules to ensure hospital compliance.

Concerns Related to Hospital Non-Compliance

The hospital price transparency rules impose two requirements on hospitals: 1) establish, update, and make public in a machine-readable file a list of all standard charges for all items and services; and 2) make public a consumer-friendly list of standard charges for a limited set of "shoppable services." See here for a more detailed summary of the reporting requirements.

The ultimate penalty for non-compliance may include the imposition of civil monetary penalties (CMPs) of up to $300 per day, if a hospital fails to respond to a request for a corrective action plan or fails to comply with the terms of a corrective action plan. CMS also announced in December 2020 that the agency plans to audit a sample of hospitals to ensure compliance, beginning in January 2021, and to investigate complaints of non-compliance submitted to CMS.

In a letter to HHS Secretary Xavier Becerra from E&C Committee Chairman Frank Pallone (D-NJ), Ranking Member Cathy McMorris Rodgers (R-WA), Health Subcommittee Chairwoman Anna Eshoo (D-CA), and Ranking Member Brett Guthrie (R-KY), the House leaders highlighted reports from the media and studies highlighting hospitals that have not posted any pricing information online or have posted some, but not all, required information.

The letter also noted concern that some hospitals are posting pricing data but making it difficult for consumers to access the information. The letter references media reports that some hospitals have blocked their pricing websites from appearing in online search engine algorithms. The lawmakers also expressed concern over reports that hospitals are requiring consumers to navigate through multiple links on a hospital's website to access pricing data.

The letter requested that HHS take the following actions:

  • Enforce the final rule to ensure hospitals are fully compliant with the disclosure requirements;
  • Revisit CMS's enforcement tools, including the amount of the civil penalty, and conduct regular audits of hospitals for compliance; and
  • Brief congressional staff on the implementation of the final rule and on the agency's audit of hospitals' compliance with the final rule.

Concerns Related to Accessibility of Pricing Data

A key question among hospitals has been what steps hospitals must take to ensure pricing data posted online is "accessible." The regulations require that hospitals make the pricing data "easily accessible, without barriers" and indicate that hospitals must make the data available free of charge, without having to establish a user account or password, and without having to submit personal identifying information. CMS declined to implement further requirements related to the accessibility of pricing data, although the agency specified that, if data becomes difficult to find or access, CMS may revisit requirements related to accessibility in future rulemaking.

Recent media reports indicated that CMS posted guidance to an online tech forum website related to the accessibility of pricing data to be reported by insurers under a different set of regulations. CMS reportedly specified that websites housing pricing information must allow for access to the website via search engines. Although the guidance was reportedly related to insurer transparency requirements, not hospital transparency rules, it could be that CMS is responding to concerns that hospital pricing data websites have been blocked from appearing in search engines.

Implications for Hospitals

HHS Secretary Becerra has expressed interest in taking actions to increase hospital price transparency, suggesting that the Biden Administration may be likely to continue implementation of the hospital price transparency rules issued by the Trump Administration. The call from members of Congress for HHS to revisit its pricing transparency enforcement tools, including the amount of the CMP to impose against hospitals that are not compliant with the reporting requirements, raises the additional question as to whether the Biden Administration will revise enforcement standards, including CMPs, to further promote transparency and ensure compliance.

In particular, hospitals should anticipate increased scrutiny of compliance by HHS and should monitor HHS guidance related to the accessibility of pricing data, in the event that the agency responds to the concerns raised by the lawmakers regarding consumers being unable to access pricing data on hospital websites.

For more information or any question regarding these issues, please contact Jeff Davis, Leslie Demaree Goldsmith, or any member of Baker Donelson's Reimbursement team.

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