Hospitals Have Doubts with the Healthcare Pricing Transparency Proposal

According to recent surveys, hospital organizations are feeling unsure about the new healthcare pricing transparency proposal.

The proposal was signed on June 24, 2019, as an executive order. The order directed HHS and several other agencies to reveal healthcare price transparency to help patients and consumers. 

President Trump suggested that the executive order will fundamentally change the healthcare marketplace to benefit patient consumers. 

The ultimate goal behind the executive order is to improve healthcare by directing HHS to require hospitals to disclose the pricing of services to patients publicly in an easy to understand format. 

The healthcare price transparency rule is intended to empower patients by requiring the public disclosure of rates negotiated by hospitals and payers. 

But unfortunately, it seems as though hospitals and other industry leaders are looking to strike down the requirement before it goes into effect next year.

It is suggested from comments on the proposal,  hospitals and their advocates argued that mandatory disclosure of negotiated rates would not reduce healthcare costs as intended. But that it would in fact harm competition and impose an administrative burden on hospitals.

Furthermore, others also suggested that finalizing the healthcare price transparency requirement would spark a legal battle.

“While we support increased transparency for patients around their out-of-pocket cost expectations, this proposal misses the mark, exceeds the Administration’s legal authority and should be abandoned,” the American Hospital Association (AHA)  commented. “Rather, we urge CMS to work cooperatively with providers, health plans, patients and other stakeholders to identify approaches that can better meet patient needs.”

It’s also important to note, the Federation of American Hospitals (FAH) called on CMS to scrap the requirement and work with providers, health plans, employers, and consumers to identify opportunities. This is ideally to provide accurate and actionable cost-sharing information.

Despite the hospital’s skepticism, the healthcare price transparency proposal is unlikely to go away. It is quite clear the Trump Administration has committed to aggressively pursuing healthcare price transparency. 

With this being said according to experts, this means hospitals need to start addressing the potential new price transparency requirement as soon as possible.

“Healthcare providers not only need to comply with the new upcoming mandates, but need to develop an integrated strategy that aligns charges, prices, and out-of-pocket costs,” said Greg Kay, senior vice president at PMMC.

As the price and cost information becomes more available in easy-to-understand formats, patients may start to shift their healthcare purchasing mindsets, buying with value in mind.

For hospitals, that means a price transparency strategy must be in place to help consumers understand pricing and quality information. 

It is thought that by providing “out-of-pocket cost estimates” will be a key component of the strategy.

Learn how our AllPayor® Software is saving other organizations $$MILLIONS!

If you are interested in a free demo of our AllPayor® Software, please go HERE or you can register for a FREE webinar HERE