OIG report finds holes in hospital price transparency compliance

Many hospitals are not publishing their prices in accordance with the price transparency law, a federal watchdog's new report found.

More than a third of the 100 hospitals reviewed by the Health and Human Services Department’s Office of Inspector General did not post machine-readable pricing data files correctly, or at all, as required by the 2021 federal law, according to the report released Friday. Most of the violations were related to disclosing the rates hospitals negotiated with insurers, metadata errors and outdated information. Five hospitals did not post any machine-readable files.

Related: Higher fines compel most hospitals to disclose prices

The OIG analyzed data from 30 hospitals that were part of the country's three largest health systems and the rest were part of a random sample of 5,504 facilities. Researchers reviewed hospital websites between Jan. 17, 2023, and March 14, 2023.

The Centers for Medicare and Medicaid Services said 11 of the 37 hospitals the OIG flagged for not complying with the law have already corrected their mistakes or are under a CMS review. The OIG said CMS should develop a training program for smaller hospitals, more clearly define what constitutes a shoppable service and invest more resources in compliance reviews.

During the OIG audit, hospitals told the agency they did not have the staff to make sense of confusing requirements and did not get enough help from CMS.

Some hospitals have said they'd rather pay the fines than comply with the law. However, that sentiment has faded over time as compliance has improved.

A spokesperson for the American Hospital Association said hospitals have improved their pricing disclosure practices since the OIG performed this analysis in early 2023.

"One third party found the majority of hospitals are in compliance with current requirements related to machine-readable files," Ariel Levin, AHA director of policy, said in a statement.

Generally, hospitals have criticized the price transparency law, arguing a one-dimensional focus on prices, without factoring in location, cost-sharing amounts and quality scores, will not lower healthcare costs. Many providers are doubtful that people will use the pricing data to shop for care.

Congress designed the 2021 law to help consumers and researchers use pricing data to slow healthcare cost growth. Lawmakers and regulators hope employers and insurers will use the information to contract with less expensive providers.