Hospitals seriously improved their compliance with price transparency regulations in 2023, according to a report released Thursday by Turquoise Health.
CMS began enforcing its price transparency rule on the first day of 2021. The law requires hospitals to post their gross charges, payer-specific negotiated charges, de-identified minimum negotiated charges, de-identified maximum negotiated charges and cash prices on their websites in a machine-readable file (MRF). It also mandates that hospitals must publish pricing for the 300 most commonly used services to their website in a consumer-friendly manner.
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Turquoise, a startup that sells price transparency software, analyzed data from 6,357 hospitals across the country and found that 90.7% of these hospitals had posted a MRF as of December 15. This high compliance rate stands in stark contrast to the way things used to be. Hospitals had a difficult time meeting CMS’ price transparency requirements in 2021 and 2022 — a JAMA study published in June 2022 showed that fewer than 6% of U.S. hospitals were fully compliant with CMS’ rule.
The highly complex nature of healthcare billing data is perhaps the main reason that hospitals have struggled to comply with the price transparency rule. The complicated structure of the U.S. healthcare system — from care variance to deductibles to billing codes — makes it hard to produce an accurate price estimate for any given service. Additionally, when CMS began enforcing its regulations, most hospitals were not equipped with the technical know-how and staff necessary to create tools that present composite billing information in a consumer-friendly way.
Not only did Turquoise’s report find that more than 90% of hospitals have posted an MRF, but it also said that 83.1% of hospitals have published “a substantial amount” of negotiated rates. Additionally, the report found that 81.3% of hospitals have posted BUCAH rates (those from Blue Cross Blue Shield, United Healthcare, Cigna, Aetna and Humana), 80.8% have posted imaging rates, 80.4% have posted surgery rates, and 77.3% have posted cash rates.
The quality of hospitals’ MRFs also improved in 2023, according to the report. More than half of hospitals earned a five-star rating for their MRFs — in order for Turquoise to grant five stars, the hospital must post an MRF that has negotiated, cash and list rates for a significant quantity of items and services.
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Hospitals may have done a better job of posting their MRFs in 2023 compared to previous years — but CMS also got more serious about penalizing them for noncompliance. Even though CMS began enforcing its rule on the first day of 2021, the agency didn’t start punishing hospitals for their noncompliance until June 2022, when it fined two Georgia hospitals. The next fines didn’t come until April of 2023. By the end of last year, CMS had fined 14 hospitals.
Photo: Tara Moore, Getty Images
