What does hospital value transparency imply for you?

“When I’m an employer, I look at three hospitals near me and say, ‘I’ll pay the lowest price. If you want to go to either of the other two you can pay the difference, ”said Anderson.

Does price transparency reduce general health expenditure?

Disclosure of actual negotiated prices, as required by this rule, can lead the more expensive hospitals in an area to lower prices in future negotiations with insurers or employers, potentially lowering healthcare spending in those regions.

It could also go the other way, as lower-cost hospitals are asking for an increase and driving up spending.

Conclusion: Price transparency can help, but the market power of the various players could be more important.

In some places that may have a dominant hospital, even employers who “know they are being scammed” may not feel like they can cut a big branded facility out of their networks regardless of the price, Anderson said.

Is the rule change a closed deal?

The hospital industry went to court arguing that parts of the rule go too far, violate their initial fitting rights, and wrongly force hospitals to disclose trade secrets. This information, according to the industry, can then be used against them in negotiations with insurers and employers.

However, the U.S. District Court for the District of Columbia disagreed with the hospitals and upheld the rule, resulting in an industry appeal. On December 29, the U.S. District of Columbia Court of Appeals upheld the lower court’s decision and did not block the rule.

In a written statement last week, the General Counsel of the American Hospital Association cited “disappointment” with the ruling and said the organization “is carefully reviewing the decision to determine next steps.”

The litigation aside, the American Hospital Association plans to speak to the new Biden administration “to convince them that some elements of this rule and the insurer rule are difficult,” said Tom Nickels, executive vice president of the trading group . “We want to help consumers, but is it really in people’s best interests to offer privately negotiated tariffs?”

Fisher said, “Hospitals are fighting this because they want to keep their negotiated insurance contracts secret,” she said. “These rules give the American consumer the opportunity to be informed.”