Background
On January 1, 2021, the Centers for Medicare and Medicaid Services (CMS) implemented The Hospital Price Transparency Final Rule which requires all acute-care hospitals’ public websites to include (1) a downloadable machine readable file with prices and charges for all services provided by the hospital and (2) a “consumer friendly display” providing the discounted cash price and payer-specific negotiated charges for 300 shoppable services (70 required by CMS, 230 selected by each hospital).1 Evaluations from early 2021 suggested that while 60–80% of hospitals provided some price information, only a minority were fully compliant.2–4 Hospitals have faced criticism over their noncompliance while CMS has been faulted for lax enforcement and the low ceiling on financial penalties (maximum levy of approximately $2 million per-year).5,6 A major unanswered question is whether hospitals have shown improved compliance and reduced their prices during the first 12 months that the rule has been in effect (January 2021–January 2022).
In February 2021, we evaluated whether a group of highly influential US hospitals — the 2020–2021 US News and World Report Honor Roll Hospitals — had posted prices for 2 imaging studies (brain MRI and abdominal ultrasound) and 3 hospital services (cardiac valve surgery, total joint replacement, and vaginal childbirth);3 we selected these services because all were included among the 70 shoppable services subject to CMS’s mandatory reporting requirement. In February 2022, we repeated our evaluation, allowing us to compare whether these hospitals had (1) increased their posting of the required machine downloadable files or (2) lowered their discounted cash price for five specific services. We hypothesized that the availability of downloadable files would increase, and hospitals’ discounted cash price would decrease.
Methods
In February 2022, we revisited the public websites of the 20 hospitals listed in the 2020–2021 US News and World Report honor roll using our previous approach.3 We assessed (1) the availability of a downloadable machine readable file of prices and (2) the availability and dollar value of the discounted cash price and negotiated charges for five specific services including two imaging tests (brain magnetic resonance imaging [MRI] and abdominal ultrasound) and three clinical services (cardiac valve surgery, total joint replacement, and vaginal childbirth).
We assessed the percentage of hospitals providing a downloadable file and discounted cash price for each of the five specified services on their website in 2021 and 2022. We also evaluated changes in prices for each item over the study period. This study used publicly available data and thus does not require ethics review.
Results
The percentage of hospitals providing prices in a downloadable file increased between 2021 (65%; 13/20 hospitals) and 2022 (85%; 17/20 hospitals) (Fig. 1). For the five shoppable services, the percentage of hospitals providing a discounted cash price increased for brain MRI, abdominal ultrasound, cardiac valve surgery, and joint replacement but decreased for vaginal childbirth (Fig. 1). None made their maximum or minimum payer-specific negotiated charges for these five shoppable services publicly available in the consumer-friendly display, without first requiring users to enter detailed health insurance plan information such as plan and member number.
Fig. 1.
Percentages of US News 2020–2021 Honor Roll Hospitals that provided prices in a downloadable file (1st two columns) and discounted cash prices (subsequent columns) for shoppable services in February 2021 and February 2022. Denominator for childbirth is 19, as 1 honor roll hospital does not offer obstetrical services.
Between 2021 and 2022, the mean cash price offered by hospitals (in nominal dollars) declined by 4% for brain MRI and 7% for vaginal childbirth, but increased by 5% for abdominal ultrasound, 23% for cardiac valve surgery, and 5% for joint replacement (Table 1); changes were similar when limited to hospitals that reported prices in both 2021 and 2022 (Table 1). The range in cash price between the least expensive and most expensive hospital differed by greater than 400% for all five procedures.
Table 1.
Discounted Cash Prices for US News 2020–2021 Honor Roll Hospitals obtained in February 2021 and February 2022
| 2021 (unadjusted) | 2021 (inflation adjusted)1 | 2022 | % change (2022 vs 2021)2,3 | |
|---|---|---|---|---|
| MRI cash price, $, mean [range] | 3793 [464–6215] | 3876 [474–6352] | 3628 [434–6789] | −4% |
| Abdominal ultrasound cash price, $, mean [range] | 767 [136–1391] | 739 [164–1422] | 802 [128–1460] | +5% |
| Valve surgery cash price, $, mean [range] | 236,125 [72,250–349,782] | 243,320 [73,840–357,477] | 289,588 [100,648–702,040] | +23% |
| Joint replacement cash price, $, mean [range] | 46,008 [22,170–71,985] | 47,102 [22,658–73,569] | 48,221 [14,889–85,087] | +5% |
| Vaginal childbirth cash price, $, mean [range] | 19,568 [7314–29,068] | 19,998 [7475–29,707] | 18,156 [7805–30,837] | −7% |
1Adjusted for 2021 Consumer Price Index Medical Component Inflation of 2.2% [https://www.bls.gov/opub/ted/2022/consumer-price-index-2021-in-review.htm] Accessed February 28, 2022
2Compares 2022 prices versus the unadjusted 2021 prices
3When limited to hospitals reporting prices in both 2021 and 2022, % change across the 5 procedures was: +0%, +4%, −3%, +5%, and +6%
Discussion
In a study of the US News and World Report Honor Roll Hospitals over the 1st year of the new federal Hospital Price Transparency Rule (February 2021–February 2022), we found modest increases in the percentage of hospitals posting their prices and posted cash prices were largely unchanged. The between-hospital variability in prices for the same procedures was enormous and persisted over time. Study limitations include our focus on a small sample of elite US hospitals, our focus on cash prices, and our inability to evaluate website usability. Additional research is needed to assess longer term trends as well as whether hospitals will honor the prices that they have posted.
Declarations
Conflict of interest
There is no external funding and none of the authors have any financial conflicts. Dr. Cram receives support from the US NIH (R01AG058878).
Footnotes
Publisher’s Note
Springer Nature remains neutral with regard to jurisdictional claims in published maps and institutional affiliations.
References
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