Timing, details unclear for executive order on price transparency

June 11, 2019 7:40 pm
  • An expected healthcare price transparency executive order is later than originally expected, and that could mean it is being scaled back.
  • CMS Administrator Seema Verma promised Thursday that transparency initiatives will move beyond the January requirement to post chargemasters online.
  • Congressional staff said the president would receive legislation targeting surprise bills by the end of July.

June 6—An expected executive order on healthcare price transparency continues to change, even as its release has been delayed, say policy watchers.

The Trump administration was expected to release an executive order in late May, according to reporting by the Wall Street Journal. Then, a key White House official working on the issue departed. Some observers subsequently expected the rule to be pushed back to the fall.

Although the White House did not respond to a request to clarify when the rule would be released, congressional sources leading transparency efforts said they knew about the staff change but had received no indication from administration officials that the order faces a months-long delay.

Sally Pipes, president and CEO of the Pacific Research Institute, who had expected the White House to release the order by May 30, said President Donald Trump’s current overseas travel may further delay it.

What will be in the executive order?

The White House would not comment on the details of the executive order (EO). Healthcare policy advocates say the various drafts they have seen would undertake a range of price transparency initiatives aimed at payers and providers.

The most notable for hospitals is a provision that would require the release of negotiated prices between providers and health plans.

Requiring public release of negotiated prices drew sharp concerns from hospitals and their advocacy groups last week in response to a request for comment on a similar price transparency idea from the Office of the National Coordinator for Health Information Technology. Among the concerns: The price transparency initiative actually could increase patients’ costs since the revealed prices would serve as a floor — not a ceiling — in future negotiations between health plans and providers.

But the longer the executive order is under review, the more it could change, said policy watchers.

“The other thing can sometimes happen is that EOs get watered down, so they could do a transparency [EO] that hospitals would embrace,” said Dan Mendelson, founder of Avalere Health. “It’s in flux right now.”

What hospitals should do to prepare for transparency

Policy watchers note that although the executive order will have the force of law, its transparency initiatives all will be implemented through the rulemaking process of various agencies, such as the U.S. Department of Health and Human Services.

Mendelson recommended that hospital executives not wait for the release of the administration’s latest transparency initiative before acting. Hospitals should go beyond obligatory steps such as the Medicare requirement that went into effect in January for hospitals to post their chargemasters online.

Some hospitals and health systems have launched a variety of initiatives to improve price transparency for patients. For instance, OSF HealthCare launched an online form to provide out-of-pocket price estimates to patients for specific procedures within a day of receiving a request.

After hospitals criticized the chargemaster-posting requirement as unhelpful to patients concerned about their specific out-of-pocket costs, Seema Verma, administrator of CMS, issued a June 6 blog post defending the rule and indicating more transparency actions are coming.

“CMS’s effort to promote price transparency is also an effort to inject competition into the healthcare market, as price transparency would allow patients to compare providers and suppliers on the basis of cost,” Verma wrote. “Beginning this year, under updated guidance issued by CMS, hospitals must make public a list of their standard charges online, which we consider to be a first step toward achieving this goal.”

Other federal transparency initiatives are coming

The expected price transparency executive order is the latest transparency push by the administration, with polls indicating voters are increasingly concerned about unexpected healthcare costs.

Congress is getting in on the transparency push with surprise medical bill legislation. According to congressional staff, the legislation is expected to clear Congress by the end of July, and will incorporate drug price controls. Legislators remain undecided on how to determine provider payments in a surprise-bill context.


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