United States proposes to increase penalties for hospitals that do not publish prices

The Wall Street Journal reported in March that hundreds of hospitals had embedded code into their disclosure web pages that prevented them from being indexed by search engines.

As part of the proposal, the Centers for Medicare and Medicaid Services, the federal enforcement agency requiring hospitals to publish their prices, is seeking to increase fines up to $ 2 million per year for them. large hospitals that do not make the prices public. Large hospitals are those with more than 30 beds.

The proposed penalty is a large increase from the maximum of $ 109,500 per year per hospital under existing rules. For hospitals with 30 beds or less, the penalties remain the same.

The proposed provision comes after many hospitals failed to publish their prices as required by federal rules that came into effect this year, undermining policy makers’ goal of stimulating competition and choice through pricing. transparent.

Data from price transparency start-up Turquoise Health Co. on Monday showed no usable price data for 32% of the 4,885 acute care, children’s or rural primary care hospitals.

The company’s database still includes 10% of those hospitals whose prices do not meet the needs.

“With the rule proposed today, we are simply showing hospitals tougher penalties: hiding the costs of services and procedures will not be tolerated by this administration,” said Xavier Becerra, Secretary of Health and Social Services .

CMS released the proposal after the Journal reported patchy compliance with publication prices, including hospitals incorporating code into their websites to disguise research prices. Some hospitals said the code was a mistake and deleted it.

The proposed rules said hospitals were using a variety of methods, including so-called block codes, to make it more difficult to find and download price data. The proposal would require hospitals to ensure that prices are accessible through automated searches and that files can be directly downloaded.

When hospitals posted the prices, the Journal found very different prices for the same service in the same hospital, with the uninsured often paying the highest prices.

The price transparency rule, which came into effect on January 1, required for the first time that hospitals disclose confidential prices negotiated with health insurers.

The Trump administration, which issued the rule, said greater transparency would boost competition and help control rising health spending in the United States.

Hospitals opposed the rule early on, losing a court challenge last year to block it.

Some health experts have said the rule’s initial penalty – $ 300 per day for each non-compliant hospital – may not be enough to convince large, well-funded hospital systems to make the prices public.

The White House this month called on the HHS to support the rule.

Under the proposal, hospitals with more than 30 beds would face penalties of $ 10 per day, per bed, with a maximum daily penalty of $ 5,500.

Of the 2,037 hospitals that appear to be non-compliant, 1,441 have 30 or more beds and would be classified as large under the proposed regulation and subject to higher penalties.

Write to Melanie Evans at [email protected], Anna Wilde Mathews at [email protected] and Tom McGinty at [email protected]