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As COVID-19 cases soar and vaccine rollout evolves, hospitals are also working to comply with a that took effect on Jan. 1.

The American Hospital Association (AHA) has argued that the rule – which requires hospitals to post the prices insurers actually pay for services – will harm hospital negotiations with insurers, require vast resources to implement, and yield little benefit for consumers. But a federal appeals court in December , and now hospitals across the country are working to comply. The Centers for Medicare and Medicaid Services (CMS) and staunch supporters of the rule say that it's a critical new step towards driving down out-of-control healthcare costs.

The rule requires hospitals to post prices online for 300 shoppable services. Seventy of those are mandated by CMS. They range from new patient visits and kidney function lab tests to MRI scans of the brain, major joint replacement, and cardiothoracic procedures for patients with comorbidities.

Prices must be provided in a machine-readable file and a display that's consumer-friendly.

Hospitals' Perspective

The AHA said it supports the goal of increasing price transparency, but through improving access to out-of-pocket estimates that are more beneficial to consumers than privately negotiated prices. It said that posting such prices can be confusing to patients and harm the marketplace.

"We worry about the anticompetitive actions that could be a fallout of these numbers," Ariel Levin, senior associate director for policy at the AHA, told 乌鸦传媒.

Levin also said that complying with the rule is a huge amount of work for hospitals that are simultaneously stretching their resources to the brink in the battle against COVID-19.

In an amicus brief filed in July, 40 state hospital associations detailed their support for the national group in its ultimately unsuccessful legal challenge to the rule. One Ohio hospital system stated that producing and updating the required data would cost as much as $2 million annually, and that the number of data points it would need to post exceeded 210 million. Other hospitals noted they would have to hire outside consultants at a cost of $100,000 or more to help with the process, and that resources for day-to-day operations were already tight.

"Those are time and financial resources that could be put to better use elsewhere," Levin said. Some of the same staff now preparing hospitals for surge capacity and tracking vaccine rollout – such as finance and information technology employees – are also working on complying with the price transparency rule, she said.

Richard Miller, executive vice president and chief business strategy officer at Northwell Health in New York, said that complying with the rule's requirements does demand significant resources initially and on an ongoing basis.

"It certainly is a large undertaking," Miller said. "We have 19 hospitals in our system and a pretty extensive list of services that we offer."

Northwell first put a price estimator tool on its website 10 years ago, he said. Since that time, patient surveys have indicated that out-of-pocket cost estimates continue to be of interest to consumers, especially with the rise of high-deductible plans.

The health system's latest consumer-shoppable tool in compliance with the price transparency rule went live in December, Miller said. The health system invested a few million dollars in it, he said, and the total investment in making the required machine-readable files is still being determined.

"While we have been working diligently to serve our communities through the pandemic's latest surge, including vaccinating our frontline caregivers, we also have been preparing for the new hospital price transparency requirements," a spokesman for Nashville-based HCA Healthcare said. "That includes posting machine-readable files containing the required rate and charge information and providing a patient payment estimator tool on the 'patients and visitors' and 'patient financial' sections of our hospital websites."

A spokeswoman for RWJBarnabas Health in New Jersey said that the health system has established an online resource for members of the public, and that, in accordance with the new rule, it is continuing to update information contained within its website.

Will Policy Drive Down Costs?

Caitlin Donovan, senior director of public relations at the National Patient Advocate Foundation, said that the organization supports the new rule as part of broader efforts to help address what patients pay for care.

Healthcare costs in the U.S. are "wildly out of line," Donovan said.

The rule is well-suited for consumers needing procedures such as X-rays and imaging, she said. That would involve looking at prices for one procedure at a few different in-network facilities.

Navigating price postings may prove challenging for consumers in need of more complex services, Donovan said. Other potential challenges include that a patient may not be able to make a decision about where they receive care because of their medical condition, constraints by their insurer, or their focus on perceived value of care and convenience over cost.

Patients may be taking more time with decisions about elective procedures during the pandemic, but they may be sicker when they do seek services, Donovan said, which could be a hindrance to using the price postings.

Overall, the rule stands to make consumers more familiar with the concept of shopping around for services in advance, she said. "People like us who have case managers who may be working to negotiate down bills, we may be able to use [the posted prices] on behalf of patients," she added.

Though hospitals and other health professionals have questioned how often consumers will use the new price postings to shop for care, it's not only about the numbers, supporters of the rule hold.

Marty Makary, MD, MPH, of Johns Hopkins University in Baltimore and editor-in-chief of 乌鸦传媒, said that the argument that people don't use pricing information when determining where to seek services isn't focusing on the right question. Proxy shoppers, including employers and consumers who may pay out-of-pocket for care, can drive the marketplace, he said.

Makary pointed to the example of two hospitals in the same area that provide the same quality of care charging drastically different prices for delivering a baby.

"Billing quality is medical quality. Financial toxicity is a medical complication," he said. "Taking care of a patient means taking care of the whole person."

CMS said it expects the rule to help to increase market competition and ultimately drive down the cost of healthcare services for patients.

Now that the rule has taken effect, CMS is auditing a sample of hospitals for compliance and investigating complaints submitted through its online portal, a spokesman said. Should the agency conclude a hospital is noncompliant, it may request a corrective action plan from the hospital and assess a civil monetary penalty not to exceed $300 a day.

In a letter issued Jan. 7 to Health and Human Services Secretary Alex Azar, the AHA urged the federal government to exercise enforcement discretion with respect to the price transparency rule as hospitals contend with COVID-19.

Following the federal appeals court decision in the legal case, Levin said the AHA is reviewing recent measures and determining whether there are any next steps and what they may be. The organization is also keeping a close eye on actions taken by the incoming Biden-Harris administration.

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