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Hospital payments, price transparency rules and other healthcare regulations will see some proposed changes for 2024, the Centers for Medicare and Medicaid Services has announced. Public comments on the changes are open through Sept. 11.

In the proposed rules changes, C.M.S. plans to tighten some regulations to update payment rates and regulations affecting Medicare services in hospital outpatient and ambulatory surgical center settings, starting in calendar year 2024. The goal, the agency said, is to increase and enforce price transparency. Drug shortages are also addressed in the wide-ranging proposal.

The payment rates are to increase by 2.8 percent, but hospitals and surgery centers that fail quality reporting program requirements may see a 2.0 percent reduction. Hospitals have complained that this is not enough money, while critics say it’s too much.

In addition, the proposed rules “require hospitals to display the required standard charges data using a CMS template. The CMS templates would be offered as a CSV ‘wide’ format, a CSV ‘tall’ format, and a JSON schema, similar to the sample templates that are currently available on the CMS hospital price transparency website and are available for voluntary use.” Currently, there is no requirement for display format, only the voluntary use suggestion “as long as they are posted online in a single machine-readable file.” People using the files in their current form note that they are confusing and come in different formats.

The rule also allows a “consumer-friendly expected allowed amount.”

On the topic of estimates, the proposed rule says, according to a C.M.S. fact sheet on the changes: “The HPT regulations require hospitals to display some of their standard charges in a consumer-friendly manner for 300 shoppable services and deem hospitals to be in compliance if the hospital elects to offer an online price estimator tool. In the CY2019 Hospital Price Transparency final rule (84 FR 65524), CMS indicated that disclosure of hospital standard charges is necessary, but not sufficient, to meet the goals for price transparency. Since that time, additional price transparency regulations and authorities (TIC and NSA) have allowed for more comprehensive and specific consumer-friendly pricing information to be released to the public, as well as consumer protections in the form of a dispute process if the final bill is significantly different from the estimate. CMS is therefore seeking comment from the public on the future evolution of HPT requirements.”

Criticism of proposed rules

Dave Chase, co-founder of HealthRosetta, a coalition working to reform insurance for employers, flyspecked the rule and sent out an appeal to employers and other interested parties to make comments by the comment deadline, at 5 p.m. Sept. 11 to the Outpatient Prospective Payment System (OPPS) Rule at More than 1,100 comments have already been received.

Here is his list of requested comments, posted with permission:

  • “Access to upfront prices from hospitals and insurers as well as historical claims data helps us as an employer to better manage our healthcare costs and put those savings back into employee wages and our bottom line.   …
  • “The rule proposes to add a “consumer-friendly expected allowed amount,” defined as an average estimate, to the machine-readable file when a price cannot be expressed as a dollar figure. Please do not allow estimates or averages in lieu of real prices. We need real, upfront, binding prices so we can have financial certainty.
  • “The rule proposes to include algorithms or percentages when a price cannot be expressed as a dollar figure. This would require us as employers to hire a third party to read and interpret the pricing data. Please do not allow formulas, algorithms, or percentages in the machine-readable file. Any formulas can be provided in a formula sheet, but the hospital pricing file needs to be only actual prices in dollar amounts.
  • “The rule proposes to allow JSON-formatted files, which are machine-readable but not human-readable and would leave patients and employers with the Price Estimator Tool which only has estimates for 300 services. Please require only CSV or Excel spreadsheet formats, to enable any consumer to easily read prices across all plans and including the cash price.
  • “The rule proposes to only require “any billing code used by the hospital,” a roll-back from requiring all codes (CPT, HCPCS, DRG, and NDC).  Please require all billing codes listed in the original rule, to best enable price comparison.
  • “The rule proposes to remove the word “enforcement” of hospital compliance and replace it with “assessment.”  Please do not dilute enforcement activities and instead strengthen them.
  • “The rule proposes to require attestation of hospital management that prices are complete and accurate.  To strengthen this requirement, please deem that the attestation would be material to payment from the federal government to incorporate potential liability under the False Claims Act for hospitals that knowingly violate the rule and falsely attest to the accuracy of their files.
  • “Finally, the rule continues the use of the Price Estimator Tool, which is a loophole allowing hospitals to only give consumers estimates, not real prices.  Please remove this loophole and require only real, upfront prices to provide consumers with financial certainty.

The “cost estimator” workaround for hospitals is particularly troublesome for patients seeking to know in advance what something will cost. We have heard time and again that these estimators are wrong, sometimes by a factor of 10 or more, and there is no accountability. After the fact, the patient comes to the hospital and says “The estimator said it would be $200, so where did this $2,000 bill come from?” and the hospital billing department says “Sorry, that was wrong — they never should have told you that.”

Employers, particularly the self-employed, are finding that the released pricing data is hard to manipulate and hard to compare. Hospitals have replied generally with some version of “We’re doing the best we can — this is a big task, and there’s a pandemic on.”

Other points

Other critics have said the rule doesn’t do enough to address surprise billing, which is a major concern for many patients and patient advocates.

A proposal for creating a buffer supply of essential drugs brought praise from the Association of Health-System Pharmacists, a trade group. “To assist in mitigating drug shortages, CMS is proposing to provide an additional payment as part of the inpatient prospective payment system to support the creation of a three-month buffer supply of essential medications.” The recommendation aligns with an ASHP proposal to address drug shortages, the group said.

The rule revises site-neutral payment policies, meaning that payment rates for certain services will be the same whether they take place in a hospital outpatient department or an ambulatory surgical center. This change is intended to address concerns about higher costs for services provided in hospital outpatient departments compared to ambulatory surgical centers. Hospitals have opposed site-neutral payment policies.

Changes in quality reporting metrics are also proposed for the Hospital Outpatient Quality Reporting Program, Ambulatory Surgical Center Quality Reporting Program and the Rural Emergency Hospital Quality Program.

The full proposal can be found here.

Jeanne Pinder  is the founder and CEO of ClearHealthCosts. She worked at The New York Times for almost 25 years as a reporter, editor and human resources executive, then volunteered for a buyout and founded...