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May 05, 2023

CMS Updates Price Transparency Enforcement

Section 2718(e) of the Public Health Service Act requires hospitals to make their standard charges public.   The CMS regulations implementing the requirements of the statute define types of standard charges such as gross charges, discounted cash prices, and charges negotiated between the hospital and third-party payers.  Hospitals must make these standard charges public by providing a single comprehensive machine-readable digital file and a consumer-friendly display of at least 300 “shoppable services.” 

CMS currently monitors and assesses compliance by evaluating public complaints, reviewing individual or entity analysis of noncompliance, and auditing hospitals’ websites.   As of April 2023, CMS has already issued over 730 warning notices of noncompliance and 269 requests that hospitals implement corrective action plans.  

CMS recently updated its enforcement process for compliance with the price transparency regulation.   

  1. While CMS will continue to require hospitals that are out of compliance to submit a corrective action plan (CAP) within 45 days when CMS issues the request, CMS will now require hospitals to fully comply with the transparency regulation within 90 days from the corrective action plan request.  Before this change, hospitals were able to propose a compliance completion date for CMS approval.   
  2. Also, CMS will now automatically impose a civil monetary penalty on hospitals that fail to submit a CAP by the end of the 45-day deadline or that timely submit a CAP but fail to come into compliance by the 90-day deadline.
  3. CMS will not issue warning notices and will go straight to requesting a CAP from hospitals that have made no effort to comply with the requirements.   

While the goal of these updates is to have hospitals come into compliance quicker, it will be interesting to see if these updates become burdensome for hospitals across the nation.

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