Trump administration makes another healthcare price transparency push with executive order
Tuesday, July 02, 2019
The Trump administration thorn may be officially piercing the side of hospital administrators. As a result of a recent executive order by President Donald Trump, they will be required to make information concerning their negotiated rates with insurers public.
Providers and payers will be ordered to give patients estimates for out-of-pocket costs for procedures in advance of the procedure, according to the order.
Per Trump’s order, the Department of Health and Human Services (HHS) will begin the rulemaking process to lay out a road map to consolidate quality measures across all federal healthcare programs. This proposed program will expand access to de-identified health claims data and allow health savings accounts to be used for additional medical services.
Trump signed the order June 24. The idea is that if people can shop around, market forces may drive down costs, NPR reports.
"Hospitals will be required to publish prices that reflect what people pay for services," said President Trump at a White House event for the signing. "You will get great pricing. Prices will come down by numbers that you wouldn't believe. The cost of healthcare will go way, way down."
Many, many insiders are against the move. Payer and provider groups oppose being forced to give more information about their negotiations — one of healthcare’s best-kept secrets.
"The President knows the best way to lower costs in healthcare is to put patients in control by increasing choice and competition," HHS secretary Alex Azar said at a phone briefing for reporters.
For the most part, consumers currently have little or no idea what the cost of a procedure will be. When they purchase care, it’s not like other purchasing decisions where they make a choice based on the price listed. So, if finalized, the Trump administration says it thinks healthcare will be more like other markets, where quality and price drive consumer behavior.
Azar said people need to know more so they can be wise consumers of healthcare. "It can't come a moment too soon because every day patients are being taken advantage of by a system that keeps critical information away from them," he said.
This isn't the Trump administration's first journey into making healthcare’s pricing more transparent.
As a result of actions during Trump’s term, CMS now requires hospitals to post their standard charges online in a machine-readable format, even though CMS has acknowledged it has no real way to enforce the requirement and hospitals have been spotty in compliance. But, it’s a start toward getting rates posted for public consumption.
Lawmakers have also taken up transparency issue. Sen. Ron Wyden, D-Ore., ranking member of the Senate Finance Committee, introduced a bill last month that would require health insurers to tell their beneficiaries what out-of-pocket costs they would face for any in-network procedure or prescription drug they seek.
The executive order has two main directives:
Within 60 days, HHS must propose a regulation "to require hospitals to publicly post standard charge information, including charges and information based on negotiated rates and for common or shoppable items and services, in an easy-to-understand, consumer-friendly, and machine-readable format using consensus-based data standards that will meaningfully inform patients' decision making and allow patients to compare prices across hospitals."
Within 90 days, HHS and the Departments of Labor and Treasury must solicit comment on a proposal "to require healthcare providers, health insurance issuers, and self-insured group health plans to provide or facilitate access to information about expected out-of-pocket costs for items or services to patients before they receive care."
The American Hospital Association continues to criticize such proposals, saying recently that a proposed rule from the Office of the National Coordinator for Health IT for making negotiated rates public, the lobbying group said the proposal missed the mark and argued for insurers to do more.
“No Americans should be blindsided by bills for medical services they never agreed to in advance,” Trump said during the signing ceremony. “We are fundamentally changing the nature of the health-care marketplace…This is a truly big action. People have no idea how big it is. Some people say bigger than health care itself.”
"For too long, powerful interests have blocked patients from knowing the true price and quality of healthcare, denying them the information they need to make informed choices," the White House said in a press release.
Per the executive order, the agencies would also need to propose a way to consolidate quality measures across all healthcare programs to simplify how it's done and store de-identified healthcare claims data so researchers and others can analyze it to make improvements to the system.
Finally, the order directs federal agencies to increase access to de-identified claims data and requires HHS to identify priority databases to be publicly released. The order requests the Secretary of the Treasury expand coverage options for high-deductible health plans and health savings accounts. It specifically asks the department to explore using HSA funds for direct primary care.
In comments related to the 21st Century Cures Act to the ONC, the American Hospital Association said it supported healthcare price transparency, but also said that the ONC’s interpretation of what should be included in the definition goes beyond what Congress intended.
“ONC lacks authority to include price information — a term it leaves undefined — in the definition of electronic health information (EHI) for purposes of determining what constitutes information blocking,” wrote Thomas P. Nickels, AHA executive vice president.
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