Last month, CMS issued three civil monetary penalty (CMP) notices for violations of the hospital price transparency regulations (HPT Rule), which requires hospitals to make public the standard charges of the items and services they provide. CMS has now issued CMP notices to seven different hospitals.
The HPT Rule took effect on January 1, 2021, and requires hospitals to publish five types of standard charges for each item and service: (1) gross charges (i.e., the chargemaster), (2) discounted prices that apply to patients who pay cash, (3) payer-specific negotiated rates, and the de-identified, (4) minimum and (5) maximum charges that a hospital has negotiated with third-party payers. If CMS concludes that a hospital is noncompliant with one or more of the requirements of the HPT Rule, CMS may take any of the following actions, which typically will occur in the following order:
- Warning letter: CMS will provide a written warning notice to the hospital with instructions to correct the deficiencies within ninety days of the specific violation(s).
- Corrective Action Plan (CAP): If the hospital does not come into compliance after ninety days, CMS will issue a CAP request with a forty-five-day deadline for hospitals to submit a CAP. Hospitals must be in full compliance within ninety days from when CMS issues the CAP request. Furthermore, if a hospital has not made any attempt to satisfy the requirements of the HPT Rule, CMS will immediately request that the hospital submit a CAP without first issuing a warning letter.
- Civil Monetary Penalty (CMP): CMS will impose a CMP on the hospital and publicize the penalty here if the hospital (1) fails to respond to CMS's request to submit a CAP at the end of the forty-five-day CAP submission deadline or (2) fails to comply with the terms of the CAP by end of the ninety-day deadline. A hospital’s maximum daily penalty will scale based on the number of beds reported by the hospital in its most recently settled Medicare cost report:
- $300 per day for a hospital with 30 beds or less (annual maximum of $109,500);
- $310-$5,500 per day ($10/bed/day) for 31-550 beds (annual maximum of $113,150 - $2,007,500); and
- $5,500 per day for a hospital with over 550 beds (annual maximum of $2,007,500).
To date, CMS has issued seven CMP notices to seven different hospitals in the following amounts:
- $883,180.00
- $847,740.00
- $117,260.00
- $214,320.00
- $102,660.00
- $70,560.00
- $63,900.00
CMS issued these CMP notices for a variety of reasons, including:
- Failure to make public a machine-readable file containing a list of all standard charges for all items and services online as required at 45 C.F.R. § 180.40(a) and 45 C.F.R. § 180.50(a).
- Failure to make available a consumer-friendly list of standard charges for a limited set of shoppable services described in 45 C.F.R. § 180.60, as required by 45 C.F.R. § 180.40(b).
- Failure to include all corresponding data elements in the list of standard charges, as applicable, as provided in 45 CFR §180.50(b).
- Failure to follow the naming convention specified by CMS, specifically: __standardcharges.[json|xml|csv] as required at 45 CFR §180.50(d)(5).
- Failure to update the standard charge information described in 45 CFR §180.50(b) at least once annually as required at 45 CFR §180.50(e).
The CMP notices also describe the timing of CMS’s initial review, CMS’s initial outreach to the hospital to correct violation(s), and any subsequent communications between CMS and the hospital, including who CMS contacted, the extension numbers CMS called, and the response (or lack of response) the hospital provided CMS.
Hospitals have sixty calendar days from the date of notice to pay the CMP. A hospital may appeal CMS’s CMP determination by requesting a hearing before an Administrative Law Judge of HHS’ Departmental Appeals Board (DAB). To request a hearing, the hospital must submit its hearing request within thirty calendar days of the issuance of the notice of imposition of CMP.
More information on the HPT Rule, including CMS guidance, is available here.
