The Key to Reducing Health Care Costs: Price Transparency
In a recent interview with Jimmy Kimmel, President Biden said reducing health care costs was a priority for him. If the President is truly interested in reducing health care costs, he should start by enforcing laws that are already on the books.
The Affordable Care Act requires hospitals to post prices for their services. During the Trump Administration, that requirement was further clarified by requiring that prices be posted online in a consumer-friendly and searchable format. Unfortunately, the law isn’t being enforced, and few hospitals are in compliance. As I detailed in my recent op-ed with ALEC CEO Lisa B. Nelson in The Orange County Register:
Former President Donald Trump began requiring hospitals to publish their prices in a consumer-friendly format or face financial penalties. This included their in-network provider rates for covered items and services, out-of-network allowed amounts and billed charges for certain items and services… Unfortunately, the Center for Medicare and Medicaid Services (CMS) announced they would delay enforcement of the rule until July 1, 2022. As a result, hospitals are in no rush to comply.
In response, states have begun passing their own price transparency laws. These laws have rare bipartisan support. Earlier this year, Virginia passed HB 481 unanimously. The new law requires hospitals to post their prices online. In Colorado, Governor Polis just signed a price transparency bill last week sponsored by members of both parties. The bill prevents the collection of medical debt if the provider’s prices are not posted at the time of service. More on that from our Orange County Register op-ed:
Codifying the requirements in state law gives states the power to enforce transparency requirements even if the federal government refuses to do so. State penalties for noncompliance can be harsher than those under federal rules. For instance, Colorado’s HB 1285, which recently passed the House and Senate, prohibits a hospital or other person or entity from collecting on debt incurred by the patient if the hospital was not in material compliance with federal hospital price transparency laws at the time of service.
On NBC Nightly News, Cynthia Fisher of PatientRightsAdvocates.org pointed out that nowhere else in our economy are people expected to buy something without knowing the price.
Giving patients full price transparency will allow them to make better decisions about where to obtain care and plan for deductibles or negotiate payment. Americans price shop for other goods and services, and health care should be no different. In these trying economic times, families across the country are looking for ways to save money. If the President truly wants to reduce health care costs, he needs to look no further than what is already federal law.