CMS begins enforcement of Hospital Price Transparency Rule

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The Centers for Medicare and Medicaid Services (CMS) has confirmed that the agency began sending warning letters to hospitals it deems out of compliance with the Hospital Price Transparency Rule in April 2021. This represents the first enforcement action under the Rule since it went into effect on January 1, 2021.

In a December 2020 Medicare Learning Network update, CMS stated that it planned to audit a sample of hospitals for compliance with the Rule staring in January and that it would also investigate any complaints it received regarding hospitals not in full compliance with the Rule. CMS previously indicated that enforcement of the Rule would generally occur in the following order: 1) written warning; 2) corrective action plan; and 3) civil monetary penalty.

Hospitals that received a written warning were generally given 90 days to address the compliance deficiencies listed in the letter, according to CMS.

The Rule requires hospitals to publish two lists of prices:

  1. A comprehensive, “machine-readable” list of various charges for all items and services.
  2. A consumer-friendly list of prices for a smaller set of “shoppable” services.

Most concerning for many hospitals, both lists must include payer-specific negotiated charges which are typically kept confidential by hospitals and payers alike. The American Hospital Association and other hospital groups unsuccessfully challenged the Rule in court in 2020.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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