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A Fifth of US Hospitals Have Been Warned Over Secretive Prices

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By John Tozzi, Tanaz Meghjani
Bloomberg News

(Bloomberg News) Some of the largest U.S. hospital chains and most prestigious academic medical centers have violated federal rules by not posting the prices they charge for care, according to records obtained by Bloomberg News. online news

For-profit HCA Healthcare Inc., the nation’s largest hospital system, and big nonprofit operators including Ascension and Trinity Health have been cited for failing to make prices fully available to the public, enforcement letters Bloomberg obtained through a public records request show. So have marquee facilities such as New York Presbyterian Weill Cornell Medical Center, Emory University Hospital and the Hospital of the University of Pennsylvania.

The records reveal the challenges U.S. regulators face as they try to force long-hidden prices into the open to address decades of rising medical expenses. Since 2021, hospitals have been required to be more transparent about what they charge. However, government data show that among 1,750 hospitals regulators evaluated as of early December, about 1,300 facilities — nearly 20% of the hospitals in the U.S. — have been warned they violated rules.

Most corrected errors after they were pointed out, and officials charged with enforcing the rules say they’ve seen more hospitals complying. Regulators are also working to make the price data more useful.

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“We want to hear from people about what’s working and what isn’t,” said Meena Seshamani, deputy director of the Centers for Medicare and Medicaid Services (CMS), in an interview.

Without better access to prices, it’s hard for patients to shop around for services. The opacity can even create risks for companies that pay for their employees’ care. Employers face potential legal exposure if they fail to adequately oversee the money they spend in employee health plans.

Critics say CMS still has work to do. A study published in JAMA Internal Medicine in September showed despite the push for transparency, prices can be exceptionally hard to pin down. Hospitals often give different estimates on their websites than the amounts they quote to patients over the phone, the researchers said.

“As long as hospitals and insurance companies hide their prices, they can charge whatever they want,” said Cynthia Fisher, founder of Patient Rights Advocate, a nonprofit that has promoted the transparency policies. “And they are.”

Thousands of hospitals

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The Trump administration launched the price transparency rule, and the policy survived legal challenges from the hospital industry. Since it took effect nearly three years ago, hospitals have been required to post files online that show their cash prices for many services, along with the payment rates they negotiate with private insurers.

The initial fines for not complying were low. CMS raised the maximum penalty to $2 million starting in 2022, boosting compliance. But the information is often inconsistent and hard for patients to navigate, and challenging even for experts.

Fourteen hospitals have been publicly penalized after being warned about transparency rule violations, and together have been fined about $4 million. Those facilities were only a fraction of those that have received letters or requests to fix violations.

The records obtained by Bloomberg showed some of the violations went to hospitals belonging to the following systems:

HCA Healthcare
CommonSpirit Health
Trinity Health
SSM Health
Steward Health Care
Emory University Hospital
Hospital of the University of Pennsylvania
Northwell Health
Baylor Scott & White Health
Memorial Hermann Health System

The vast majority of those violations have been corrected, according to the records.

Bloomberg reached out to all the hospital systems named above. Those that responded said they are committed to improving transparency and will continue to ensure patients have access to the most current pricing information so they can make informed health-care decisions.

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Other hospitals said CMS had flagged minor violations, like files with formatting issues that were made in the early days of the program when hospitals were still learning how to navigate the new rules.

The government has yet to check whether thousands more are complying with the rules.

Slow progress

CMS is tightening enforcement of existing rules and aims to make price information more useful. Meanwhile, new legislation to strengthen transparency rules passed the U.S. House this month with wide bipartisan support.

Consumers, employers and researchers benefit from the data, CMS’ Seshamani said. Insurance companies have used it to “identify hospitals that are cost outliers” and renegotiate contracts, she said.

Some critics say medical facilities are still dragging their feet. They’ve also argued that even hospitals that CMS deems compliant may not be providing useful information for companies and patients trying to understand their costs.

“Having a file on your website with partial or incomplete information doesn’t help an employer understand how their insurance competes,” Patient Rights Advocate’s Fisher said.

Hospitals are working with CMS to adhere to the rules, said Ariel Levin, director of policy at the American Hospital Association. However, some requirements are hard to meet because prices are determined by complicated formula, and in recent years health-care facilities were preoccupied with the COVID-19 crisis.

—With assistance from Cailley LaPara.

©2023 Bloomberg News. Visit at Distributed by Tribune Content Agency

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