By Leslie Small
On Nov. 15, the Trump administration released two rules — one final, one proposed — outlining new price transparency requirements for hospitals and health insurers, which the industry has long warned will impede competitive rate negotiations without actually benefiting patients.
In the proposed rule, slated for publication in the Nov. 27 Federal Register, the administration would require all non-grandfathered group and individual health plans to:
✦ Provide consumers with personalized out-of-pocket cost information for all covered health care items and services through an “internet-based self-service tool” and in paper form upon request, and
✦ Make their negotiated rates with in-network providers and historical allowed amounts to out-of-network providers available to the public in “standardized, regularly updated machine-readable files.”
In a simultaneously issued final rule, the administration outlines transparency requirements for hospitals. It says they must make public, in a machine-readable format, all “standard charges” for items and services — which the rule defines as gross charges, payer-specific negotiated charges, de-identified minimum and maximum negotiated charges, and discounted cash prices. Plus, hospitals will have to publicly post standard charges for at least 300 “shoppable services” in a consumer-friendly format.
Previously, “standard charges” simply meant hospital chargemaster prices, explains David Kaufman, a partner at Laurus Law Group LLC and former general counsel of Blue Cross Blue Shield of Illinois. Whether CMS is allowed to expand that to include negotiated rates is “going to be the key issue” in a court challenge that hospital groups have promised to file, he tells AIS Health.
But while legal challenges could delay or even prevent one or both rules from being implemented, that doesn’t mean health care organizations have nothing to worry about, says attorney Katie Keith, a principal at Keith Policy Solutions, LLC.
“I guess if I was in the industry, I wouldn’t have my head in the sand about this,” she says. “Insurance companies, to the extent that they have not developed these tools and are not working on this and are not focused on transparency, it does seem like they’re going to want to increase focus on it, because I don’t know that every lawsuit will be successful.”