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News | Compliance

Mandates related to pricing, Medicare participation lead hospital concerns over healthcare IT proposed rules

News | Compliance

Mandates related to pricing, Medicare participation lead hospital concerns over healthcare IT proposed rules

  • Hospitals opposed a proposed ONC requirement that they provide pricing information for each patient and procedure.
  • Instead, hospitals urged that private and public insurance plans provide out-of-pocket price information to their beneficiaries.
  • Hospitals warned against requiring electronic data exchange of specific information, citing a lack of infrastructure.

Hospitals supported many of the transparency goals of two proposed healthcare IT rules, but two areas drew sharp concerns.

In comments due June 3, hospitals and their advocates warned of far-reaching consequences if the Trump administration finalizes proposed rules to change Medicare and Medicaid conditions of participation (CoP). The new rules would require exchange of specific patient electronic health information (EHI) and that records include pricing information.

Concerns about the price-information requirement

Specifically, a proposed rule on interoperability from the Office of the National Coordinator for Health Information Technology (ONC) sought comments on including within required EHI “price information,” which was left undefined, as part of requirements to prevent information blocking. 

Hospitals raised concerns about the proposal, including that it:

  • Fails to enhance competition based on quality and value, since price is not a proxy for quality
  • Creates a costly unfunded mandate by requiring hospitals to provide prices for each patient and procedure
  • Violates the First Amendment by compelling disclosure of confidential commercial information
  • Inhibits competition by creating a platform for price fixing

“Health plans would know what every other health plan was paying and could use that information indirectly to collude and drive prices below competitive levels, thereby reducing the incentives for actual competition in the marketplace and threatening the viability of some of the nation’s most vulnerable hospitals,” wrote the American Hospital Association.

Like other hospital-sector stakeholders, HFMA questioned both ONC’s legal authority to create the price-listing requirement and the requirement’s usefulness for insured patients, who prioritize out-of-pocket costs.

“HFMA’s members believe the most appropriate source of information for commercially insured patients/members is their health plan because it will have the necessary data to provide the most accurate, relevant estimate,” HFMA wrote in a letter to ONC.

Similarly, the Michigan Health and Hospital Association urged that private and public insurance plans provide out-of-pocket price information to their beneficiaries, with providers offering patient-specific out-of-pocket information to uninsured patients.

Trinity Health warned against using Medicare prices as a reference tool because such information could be misleading to non-Medicare patients and shoppers.

“Showing the rate Medicare pays may cause patient confusion and suspicion of the hospital’s pricing fairness. Hospitals with true procedure-level cost knowledge submit that Medicare reimbursement does not come close to covering their current costs,” wrote Tina Weatherwax Grant, JD, vice president of public policy and advocacy for the health system.

Alternate approaches could include federally developed or supported “real-time benefit tools that provide accurate out-of-pocket costs at the point of care,” wrote the Medical Group Management Association.

Hospitals also challenge CoP proposal

The Centers for Medicare & Medicaid Services (CMS) released a separate but related proposed rule related to health information. It would amend the Medicare and Medicaid CoPs for hospitals, critical access hospitals and psychiatric hospitals to require the electronic exchange of admission, discharge and transfer (ADT) information. Additionally, CoPs would require hospitals to provide patient-event notifications.

Hospital concerns with the CoP provisions included that they:

  • Assume an infrastructure allowing routine exchange of such information even though such an infrastructure has not been built
  • Create conflicting and confusing hospital requirements relative to the ONC information-blocking rule
  • Move beyond existing information-sharing requirements to focus on the mechanism by which information must be shared
  • Create liability under the False Claims Act for hospitals that certified they were not an information blocker under the Promoting Interoperability Program (PIP)

Michigan-based Spectrum Health was among the health systems urging CMS to focus on building the PIP data-exchange infrastructure rather than layering additional requirements on hospitals.

“Utilizing the CoP program is an unnecessary burden for enhancing hospital use of these feeds,” wrote Jason Joseph, chief information officer for Spectrum Health.

CMS’s assertion that the ADT data requirement would impose minimal, one-time costs on hospitals was challenged by the College of Health Information Management Executives (CHIME) and the Association for Executives in Health Information Technology (AEHIT).

“We believe CMS has significantly underestimated the complexity of meeting this mandate, and we do not agree with the agency’s estimation that this should require little effort and be a one-time cost,” CHIME and AEHIT wrote to CMS.

The groups urged CMS at a minimum to give hospitals three years to prepare before the requirement takes effect.

The hospital advocacy group Premier recommended that CMS instead use existing policy levers to establish a system of event notifications and that it work to improve existing infrastructure in support of health data exchange.

About the Author

Rich Daly, HFMA senior writer/editor,

is based in the Washington, D.C., office. Follow Rich on Twitter: @rdalyhealthcare

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