While I’m not sure exactly why changes to the Hospital Price Transparency requirement happened in the Medicare Hospital Outpatient Prospective Payment System and Ambulatory Surgical Center Payment System Final Rule (CMS-1753FC), it happened there nonetheless (Here are the details on the Federal register). And let’s just say that CMS has put some teeth behind the price transparency requirements for hospitals.
We’ve written and discussed the hospital price transparency rule a lot before. The reality is that compliance with the rule was not very strong. Many healthcare organizations were fine to just take the penalty. Others tried to hide their transparency which is extremely ironic. Some applied the bare minimum to try and meet the rule. The AHA even lost a court case trying to stop it.
CMS is responding in kind with changes to the penalties which are likely going to make ignoring the rule much harder for healthcare organizations. Here’s the summary of that change:
Increase in Civil Monetary Penalties (CMP): CMS is setting a minimum CMP of $300/day that will apply to smaller hospitals with a bed count of 30 or fewer, and a penalty of $10/bed/day for hospitals with a bed count greater than 30, not to exceed a maximum daily dollar amount of $5,500. Under this approach, for a full calendar year of noncompliance, the minimum total penalty amount would be $109,500 per hospital, and the maximum total penalty amount would be $2,007,500 per hospital. This approach to scaling the CMP amount retains the current penalty amount for small hospitals, increases the penalty amount for larger hospitals, and affirms the Administration’s commitment to enforcement and public access to pricing information.
While some hospitals could accept the $2 million penalty, I don’t think that most will. The effort to comply is much less than the penalty, so I think they will finally comply. The smaller hospitals will likely have more of a challenge. Their compliance is just about as hard as a big hospital, but I don’t think most will want to take a $100k hit when they’re likely barely surviving as is.
The new rule also requires healthcare organizations to not add barriers to access to the machine-readable file. Here’s the summary of that change:
Prohibiting Additional Specific Barriers to Access to the Machine-Readable File: CMS is updating the regulation’s prohibition of certain activities that present barriers to access to the machine-readable file, specifically requiring that the machine-readable file be accessible to automated searches and direct downloads.
They probably thought they were being tricky by putting in code to stop search engines from indexing their pricing page. Well, that’s not allowed anymore.
No doubt CMS is committed to more transparency in prices. We’ve discussed before why this regulation doesn’t really do much to help patients have access to the pricing for health services they’ll receive. However, it shows the clear intent from CMS to push forward with more transparent healthcare pricing.
Hospitals will need to comply with the rule by January 1, 2022 to avoid these new penalties. How’s your organization doing with this? Will these penalties cause more hospitals to comply?
