Biden to crackdown on hospital price transparency violations

The Biden administration wants to increase fines for hospitals that are not making clear, accessible pricing information available online, according to CMS’ proposed outpatient pay rule on Monday.

The agency has proposed increasing the minimum fine for violations of the hospital price transparency rule to $300 per day for hospitals with 30 or fewer beds. Hospitals with more than 30 beds would have to pay $10 per day for each bed up to $5,500 daily. Hospitals could face annual fines of $110,000 to more than $2 million, depending on their size.

“As President Biden made clear in his executive order promoting competition, a key to price fairness is price transparency,” HHS Secretary Xavier Becerra said in a statement. “No medical entity should be able to throttle competition at the expense of patients. I have fought anti-competitive practices before and strongly believe healthcare must be in reach for everyone. With today’s proposed rule, we are simply showing hospitals through stiffer penalties: concealing the costs of services and procedures will not be tolerated by this administration.”

Less than 6% of hospitals are fully compliant with the federal requirement that health systems publicly disclose the prices they charge for medical care, according to a newly published report.

The Biden administration also wants to halt the phase-out of the inpatient-only list and reinstate the patient safety criteria for evaluating whether Medicare should pay ambulatory surgical centers for a given procedure. In its 2021 outpatient pay rule, CMS allowed ambulatory surgical centers to perform nearly 270 additional procedures starting this year. But Medicare plans to stop reimbursing for most of those services in 2022, according to a CMS fact sheet.

“CMS reviewed each procedure code of services that were removed and found none met criteria for removal, with insufficient supporting evidence that the service can be safely performed on the Medicare population in the outpatient setting,” CMS said in a statement.

Hospital groups and many experts had argued against ending the inpatient-only list, claiming the move could jeopardize quality and safety because many of the procedures are high-risk. Hospitals also worried about how the move would affect their finances since it would likely lead to more treatment in lower-cost settings. But the Trump administration claimed the quality and safety concerns were overblown, with former CMS Administrator Seema Verma noting that commercial payers already pay for such services outside the hospital setting.

CMS plans to update outpatient prospective payment and ambulatory surgical center rates by 2.3%. The agency based the rates on 2019 claims data instead of 2020 claims data because of the pandemic.

The agency also wants to kick off the Radiation Oncology Model next year with the five-year performance period starting on Jan. 1, 2022. CMS has proposed changing the baseline period from 2016-2018 to 2017-2019. CMS wants to lower the discounts to 3.5% and 4.5% for the professional and technical components, respectively.

In addition, CMS asked the healthcare industry for feedback on addressing health equity through its quality programs for hospital outpatient departments and ambulatory surgical centers.

“CMS is committed to addressing significant and persistent inequities in health outcomes in the United States and today’s proposed rule helps us achieve that by improving data collection to better measure and analyze disparities across programs and policies,” CMS Administrator Chiquita Brooks-LaSure said in a statement. “We are committed to finding opportunities to meet the health needs of patients and consumers where they are, whether it’s by expanding access to onsite care in their communities, ensuring they have access to clear information about health care costs, or enhancing patient safety.”

Likewise, the agency is looking for more information about which flexibilities for mental health services it should keep after the public health emergency ends and implementing a new payment model for rural hospitals that agree to wind down inpatient care and build up outpatient services.

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Marie Maynes
Marie Maynes is a Sports enthusiast and writes for the Sports section of ANH.