Over a year-and-a-half ago, all 6,000 or so U.S. hospitals were required to provide pricing information online so patients could comparison shop and avoid surprises. After audits, warning letters, and requests for plans to take corrective actions, the Center for Medicare and Medicaid Services (CMS) recently started issuing fines for noncompliance – and they’re not cheap.
Starting January 1, 2021, hospitals were required to provide clear, accessible pricing information about the items and services they provide, as a machine-readable file and in a consumer-friendly format. CMS began auditing a sampling of hospitals that same month. Since that time, it issued over 350 warnings for noncompliance, followed by more than 150 corrective action plan requests from those who didn’t do anything after the initial warning. After addressing citations, 170 hospitals received case closed notices.
This past June, the CMS issued the first Civil Monetary Penalties to two hospitals in Georgia for noncompliance. One penalty was for over $200,000 and the other was for almost $900,000. Penalties are based on the number of beds at the facility and number of days out of compliance; they can range from $300 to $5,500 per day.
Should hospital administrators now expect a floodgate of fines? It depends on who you ask.
PatientRightsAdvocate.org conducted its own analysis of 1,000 websites and found just 14% fully met the transparency requirements. Over 85% didn’t include all information required in their machine-readable files. Less than one-third posted charges for 300 shoppable services in the format required. While 85% did provide a price estimator tool, 20% did not show discounted prices for the uninsured and self-paying clients.
As reported by Roll Call, “Turquoise Health, which was formed at the end of 2020 to analyze data and help providers and payers become compliant with the rules, has found that about 4,500 of the nation’s 6,093 hospitals have posted data files.”
The American Hospital Association asserts that most hospitals are in compliance, and that data that indicates otherwise may be misleading or not telling the whole story.
Perhaps the more interesting information comes from what the newly available data can tell us. A study of outpatient imaging at 89 of the leading pediatric hospitals conducted by the JAMA Network found 98% complied with the shoppable services requirement, but less than 40% complied with both the shoppable services and machine-readable file requirements. Data showed an 84% cash price variation for retroperitoneal ultrasound; 82% for a CT of the head without contrast; and 74% for abdominal ultrasonographies. The actual charge variations were much lower: 45%, 52% and 48%, respectively.
Only time will tell whether the new requirements (and fines) will ultimately lead to lower overall health care costs due to consumerism. Still, one big question remains: Will consumers use the website data to shop for their health care like a car or a home? To be continued…
In the meantime, you can always count on RBT CPAs to handle all your tax, accounting, audit, and other needs, so you’re freed up to focus on more important things like patient care and compliance. Please don’t hesitate to give us a call.