In a recent appearance before the House Energy and Commerce Committee’s Subcommittee on Health, Centers for Medicine & Medicaid Services (CMS) Administrator Chiquita Brooks-LaSure spent some time shedding light on the agency’s most recent efforts.
Her testimony included highlighting the agency’s work in implementing the Inflation Reduction Act, which reduced out-of-pocket drug costs for seniors, as well as their efforts to make hospitals more accountable to federal price transparency requirements.
The latter should be of particular interest to healthcare and insurance providers because it highlights the increasing focus on price transparency in the healthcare industry. With CMS tightening its leash on facilities’ compliance with federal price transparency guidelines, it is crucial that healthcare providers stay informed to ensure compliance now and in the future.
Here are a few key takeaways from Mrs. Brooks-LaSure’s testimony:
Stricter Enforcement of Transparency Requirements
According to Mrs. Brooks-LaSure, CMS has updated its enforcement process to shorten the time period a hospital has to come into compliance once a deficiency is identified.
Instead of being issued a warning to facilities who have not met the standards of price transparency requirements, hospitals will now be immediately issued a request for a corrective action plan (CAP).
Hospitals that fail to submit a CAP within 45 days of the request or those that fail to come into full compliance within 90 days after the CAP is requested will have a civil monetary penalty imposed upon them.
CMS insists that these new enforcement policies, along with other transparency efforts around payers’ prices and healthcare facility ownership, will incentivize competition and result in additional savings for our healthcare system and for patients.
The enforcement has already begun.
As of April 2023, CMS has issued more than 730 warning notices and 269 CAP requests to non-compliant hospitals and has already imposed civil monetary penalties on four.
CMS is Working to Increase Authority
CMS is working to emphasize the significance of price transparency in the healthcare industry, aiming to empower patients by ensuring that they always have access to accurate and timely information about healthcare costs before seeking care.
In addition to the tightening regulations around facility compliance, CMS is making ongoing efforts to define clear formatting standards for healthcare organizations to follow regarding price data standardization and compliance metrics.
In doing this, the agency hopes to clear up the confusion and inconsistencies that so often occur between hospital pricing data and insurance company data.
And though the CMS has a limited authority on hospital price transparency (consisting of a single sentence within the statute) they are seeking to increase their authority by working with lawmakers to broaden their regulatory reach.
Strides Toward Compliance
The measures taken by CMS have already been seeing some success in clearing up the confusion surrounding price transparency.
A report released by price transparency data startup, Turquoise Health, suggests that hospitals and payers are already making strides toward compliance with these stricter CMS requirements.
The report states that 84% of hospitals had posted a machine-readable file with pricing data as of the end 2023’s first quarter, 74% had posted negotiated rates data, and 71% had posted cash rates.
This trend is expected to continue and the subcommittee is planning to hold a second panel regarding these issues at a later date.
Empowering Our Patients Through Transparency
The CMS’s regulatory reach can only be expected to grow and, as the healthcare landscape continues to evolve, it is important that healthcare facilities make a greater effort to adhere to these new regulations.
By enhancing price transparency, healthcare providers around the country can work together to not only adhere to these regulations and stay in compliance, but work to empower our patients and improve their overall experience with the care we provide.