Healthcare News of Note: Hospitals ignoring federal price transparency rules get warning letters from CMS
- CMS has sent a first wave of warning letters to hospitals that are violating federal rules requiring them to make public the prices they negotiate with insurers.
- A new Government Accountability Office report indicates patient access to behavioral healthcare fell during the pandemic and raises concerns about whether insurers are abiding by a federal law requiring parity in insurance coverage.
- 2020 was the first year in which fewer than half of patient care physicians worked in a private practice, marking a drop of almost 5 percentage points from 2018, according to the latest American Medical Association Physician Practice Benchmark Survey.
Over the last couple of weeks, I’ve found these industry news stories that should be of interest to healthcare finance professionals.
1. Hospitals breaking CMS price transparency rules to get warning letters
A May 7 Modern Healthcare article (log-in required) reported, “CMS is sending warning letters to hospitals breaking new federal rules requiring them to make public the prices they negotiate with insurers, a CMS spokesperson confirmed.
“The regulation took effect on Jan. 1 and forces hospitals to publish a machine-readable file online containing their payer-negotiated rates. It also requires them to make available a consumer-friendly display of at least 300 shoppable services, including 70 specified by CMS. But 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 for all shoppable services.
“But around two-thirds of the country’s largest hospitals are not complying with the new price transparency regulations, a Health Affairs study found in March. More than 50 hospitals either did not include the payer-specific negotiated rates with the payer’s name and plan or were non-compliant in some other way. A dozen didn’t post any files or provide links to searchable databases that weren’t downloadable.”
CMS also described next steps:
- Hospitals have up to 90 days to correct issues identified in the warning letter.
- A second review by CMS will be conducted when the 90-day period ends or when a hospital notifies the agency that it fixed the problems.
According to a May 7 Becker’s Hospital CFO Report article, “The price transparency rule indicates that if a hospital is noncompliant, the agency may request a corrective action plan, assess a civil monetary penalty of up to $300 per day or publicize the penalty on a CMS website.”
2. GAO report questions whether insurers are abiding by federal law requiring parity in coverage of mental health visits
An April 30 Kaiser Health News article reported, “Therapists and other behavioral health care providers cut hours, reduced staffs and turned away patients during the pandemic as more Americans experienced depression symptoms and drug overdoses, according to a new report from the Government Accountability Office.
“The report on patient access to behavioral health care during the covid-19 crisis also casts doubt on whether insurers are abiding by federal law requiring parity in insurance coverage, which forbids health plans from passing along more of the bill for mental health care to patients than they would for medical or surgical care.
“The GAO’s findings are ‘the tip of the iceberg’ in how Americans with mental, emotional and substance use disorders are treated differently than those with physical conditions, said JoAnn Volk, a research professor at Georgetown University’s Center on Health Insurance Reforms who studies mental health coverage.
“The GAO report, shared before publication exclusively with KHN, paints a picture of an already strained behavioral health system struggling after the pandemic struck to meet the treatment needs of millions of Americans with conditions like alcohol use disorder and post-traumatic stress disorder.”
Highlights from the report, as described in the article by Emmarie Huetteman, include the following:
- Up to 4 in 10 adults on average reported anxiety or depression symptoms during the pandemic, compared with about 1 in 10 adults in early 2019.
- During the first seven months of the pandemic, there were 36% more emergency department visits for drug overdoses and 26% more visits for suicide attempts, compared with the same period in 2019.
The article also stated: “Provider groups interviewed by GAO investigators acknowledged staff shortages and some delays in getting patients into treatment. They noted that the pandemic forced them to cut outpatient services and limit inpatient options. They also told the researchers that payment issues are a significant problem that predated the pandemic. In particular, the GAO said, most groups cited problems getting reimbursed by Medicaid more often than any other payer.”
3. AMA Physician Practice Benchmark Survey: Shifts toward larger practices and away from physician-owned practices have accelerated
A May 6 article in Healthcare Dive reported, “Last year marked a historic shift in the organization of medicine, with fewer than half of U.S. doctors working in a private practice, according to the latest American Medical Association Physician Practice Benchmark Survey. And among those private practices that continue to operate, many are trending toward a larger size.
“According to the report, 50.2% of physicians were employees, up from 47.4% in 2018 and 41.8% in 2012. The proportion of doctors working in a private practice was 49.1% last year.
“Hospitals are one of the largest employers of physicians, with the proportion increasing nearly 50% between 2012 and last year. And with the vast majority of doctors under the age of 40 now employees rather than employers, it suggests the trend will continue over the long term.”
The article by Ron Shinkman also provided the following information from the AMA survey:
- Among physicians working for someone else, 56.5% are women and fully 70% are under the age of 40.
- Some 58% of pediatricians were employed, compared with less than 40% of specialty surgeons and radiologists.
- About 20% of physicians worked for medical groups owned by hospitals, while 9% worked for hospitals directly and 8.2% were employed by practices owned by other physicians.
An AMA Policy Research Perspectives paper stated that 2020 was the first year in which less than half (49.1%) of patient care physicians worked in a private practice, marking a drop of almost 5 percentage points from 2018, when 54% of physicians worked in physician-owned practices.
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