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June 28, 2021 04:01 PM

Most Americans unaware of CMS price transparency rule

Matti Gellman
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    Modern Healthcare Illustration / Getty Images

    More than 90% of Americans are unaware of a CMS rule allowing patients to view and compare treatment costs on hospital websites so they can shop for lower priced care, according to a recent Kaiser Family Foundation survey.

    While only 9% of seniors have researched treatment prices online, they are more likely to know about the rule change than any other age group. Households with incomes over $90,000 are also more likely to know about hospitals' requirement to disclose pricing data. But these wealthier households spent less time researching prices than those with incomes under $40,000.

    "The low level of awareness of this federal requirement is consistent across different age groups, income levels and health status," KFF said.

    The Trump administration rule, which went into effect on January 1, requires hospitals to make pricing information accessible to patients so that they can shop for lower priced care from different providers. The rule also requires they make available a consumer-friendly display of at least 300 shoppable services, including 70 specified by CMS. Hospitals don't need to post a list of shoppable services if they allow consumers to use a price estimator tool to calculate their out-of-pocket costs.

    Prior to the rule's implementation, hospitals published aggregate, undiscounted charges for services, but that price is rarely what an insurer or patient would pay.

    More than 80% of respondents to the May survey said they have not researched the price of hospital treatments in the last six months.

    Experts say that consumers aren't likely to shop around unless it's easy. The newly available pricing data is more likely to help third-party app developers, researchers and policymakers.

    The Biden administration has promised a crackdown on hospitals shirking transparency obligations. More than 50 hospitals didn't include payer-specific negotiated rates or didn't comply with some part of the price transparency rule as of March, according to Health Affairs. A dozen hospitals didn't post any files or provided links to searchable databases that users couldn't download.

    Nearly 92% of survey respondents with a chronic condition, who are more likely to need hospital care, are either unaware or convinced hospitals do not have to share pricing information online. Only 4% of Black consumers polled were aware of the rule compared to their white (9%) and Hispanic (12%) counterparts. Black consumers are also more likely to suffer from chronic conditions than other groups, according to the Centers for Disease Control and Prevention.

    Many adults who searched for prices online weren't more aware of price transparency requirements, with 33% reporting there was no mandate for hospitals to disclose prices compared to 20% among those who did not search for prices.

    CMS started auditing hospital websites and reviewing complaints shortly after the rule took effect. According to an agency spokesperson, the first round of warning letters to hospitals were sent in April. CMS can also fine hospitals up to $300 per day for violating the disclosure requirements.

    Some hospitals have been fighting price transparency regulations, arguing that consumers don't use price estimators to determine their care plans and releasing payer-specific rates could increase prices.

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