CMS Should Take Stronger Stance On Hospital Pricing Compliance: GAO

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Dive Brief:

• The CMS does not routinely check required, publicly posted hospital pricing data for completeness or accuracy, raising questions about the usability of data provided, according to a report from the Government Accountability Office published Wednesday.
• Stakeholders say posted hospital pricing data is often difficult to use. They reported to GAO difficulty accessing pricing information and comparing files across sites due to missing and incomplete data, formatting inconsistencies and complexities of pricing data. 
• The GAO recommended the CMS change its compliance review process and leverage “any additional cost-effective enforcement activities as needed.” 

Dive Insight:

Lawmakers tasked the GAO with determining whether CMS’ 2021 hospital pricing policy — which requires hospitals to annually post prices for certain services in machine-readable files on their websites —  was working as intended to help patients and payers shop for services.

Sixteen stakeholder groups spoke to the GAO about their experience with price transparency files. They reported difficulties accessing the data, wrangling it and interpreting it.

Some hospitals posted files in obscure locations online or password-protected them, when they are meant to be publicly available. Others failed to report required billing codes or identify which health plans were associated with plan-specific negotiated prices. When stakeholders could get access to information, they said it was difficult to compare pricing information across hospitals because the facilities did not use standard definitions for procedures.

The GAO’s findings echo previous reports from watchdog groups, which have found the hospital industry has consistently been out of compliance with pricing transparency policies.

A March report from nonprofit organization Patient Rights Advocate found compliance was backsliding — with only 34.5% of 2,000 hospitals deemed to be fully compliant with price transparency rules as of January, compared to 36% as of July 2023.

The CMS has issued some sanctions for hospitals found out of compliance, including civil monetary penalties totaling more than $4 million to 14 hospitals that failed to address their shortcomings in a timely fashion, according to the report. 

From 2021 through 2023, the CMS initiated 1,287 enforcement actions, with most related to missing data, lack of a machine-readable file and noncompliance related to shoppable services. 

However, the CMS currently does not check files for completeness or accuracy — raising questions about whether hospitals considered to be in compliance with pricing policies are posting usable files.

The CMS said that its current process is the “most effective use of agency resources,” however the GAO is pushing for more thorough oversight.

“While CMS officials stated that they do not have the resources to check the accuracy and completeness of all hospital pricing data, the agency has cost effective enforcement options it could consider, if needed, such as using risk based or random sampling,” the report suggested.

Hospitals have been required to submit a standardized machine-readable file since July — a move that the CMS expects will enable the agency to perform more efficient file review. The CMS is exploring automating the review process, according to the report.

In a written statement to Healthcare Dive, Cynthia Fisher, founder and chairman of Patient Rights Advocate applauded the report, stating, “The GAO’s report and recommendations are a significant step forward in holding hospitals accountable for their ongoing noncompliance with the hospital price transparency rule that took effect nearly four years ago.”