- Daphne Hao, BA1Vinay K. Rathi, MD, MBA2Joseph S. Ross, MD, MHS3,4,5,6
The Centers for Medicare & Medicaid Services (CMS) implemented the Hospital Price Transparency rule in 2021,1 requiring hospitals to publicly disclose payer-negotiated prices or face maximum fines of $2 million per year.2 While hospital price transparency has increased, compliance remains uneven3 and may be worse among hospitals with fewer resources, particularly those caring for more disadvantaged patients. These hospitals may be underresourced because of their patient populations or because they bring in less revenue for the same services. We used hospital- and payer-disclosed pricing data to examine compliance and pricing, focusing on 10 top oncologic surgical procedures because improved transparency may be associated with reduced financial hardship for patients receiving cancer care.
MethodsThis cross-sectional study used publicly available, nonpatient data and was therefore exempt from institutional review board (IRB) review by Mass General Brigham IRB. It is reported in accordance with the STROBE reporting guideline. We included hospitals participating in the CMS Inpatient Prospective Payment System (IPPS) with available pricing data from Turquoise Health to determine overall compliance (yes or no), defined as price information being mostly or completely available as usable, machine-readable files (eMethods in Supplement 1).
We characterized hospitals’ extent of care for disadvantaged patients using 2 metrics. First, we used the 2023 Lown Hospitals Index inclusivity score ratings, focused on racial and income inclusivity and categorized into 3 tiers: low (1-2), medium (3), or high (4-5).4 Second, we used CMS Disproportionate Share Hospital (DSH) patient percentage value from the fiscal year 2024 IPPS, categorized into tertiles (<22%, 22%-33%, and >33%).5
We compared hospital quarterly price compliance from quarter 1 (Q1) 2022 through Q3 2023 by hospital inclusivity and DSH percentage using discrete-time hazards modeling. We identified payer-reported negotiated prices for 10 top oncologic procedures to compare compliant and noncompliant hospitals (required by CMS to be reported by payers since July 1, 2022). Prices were adjusted for hospital wage index, summarized as a median per procedure at each hospital, and compared between compliant and noncompliant hospitals using student t tests. We selected an α level of .05 for statistical significance; Benjamini-Hochberg adjustment for 16 tests reduced the significance threshold to .0375. Two-sided tests were performed using R version 4.5.1 (R Project for Statistical Computing). Data were analyzed from January 2022 through September 2023.
ResultsAmong 2464 hospitals (Table; eFigure in Supplement 1), those more inclusive of disadvantaged populations had lower compliance rates and were less likely to become compliant over time (Figure, A-C). For example, hospitals with low Lown race inclusivity had a higher hazard of becoming compliant over time (hazard ratio, 1.25; 95% CI, 1.05-1.48; P = .009).
Figure. Hospital Compliance Over Time and Negotiated Facility FeesA-C, Hazard ratios (HRs) are calculated and reported with 95% CIs using the high-inclusivity group as the reference group. D, Mean facility fees for the top oncologic surgical procedures in quarter 1 (Q1) 2023 are presented. DSH indicates Disproportionate Share Hospital; error bars, standard errors.
As of Q1 2023, compliant hospitals had significantly higher mean negotiated facility fees for most oncologic procedures (6 of 10 surgery types [60.0%]) compared with noncompliant hospitals (Figure, D). For example, the mean (SD) negotiated facility fee for a prostatectomy at compliant hospitals ($9594 [$256]) was $1677 higher than that of noncompliant hospitals ($7917 [$367]; P = .001).
DiscussionIn this cross-sectional study, hospitals serving more disadvantaged populations were less compliant with the Hospital Price Transparency final rule over time between Q1 2022 and Q3 2023. Given that racial minority and low-income groups are more likely to experience health care–related financial stress, our findings reveal a harmful paradox: less transparency information available for disadvantaged patients, who have the greatest need to make financially informed decisions.
Our findings also challenge a common assumption that hospitals may be noncompliant to avoid disclosing high prices that could harm brand or market position.6 Broad-reaching, payer-disclosed pricing data revealed that compliant hospitals often had higher facility fees compared with noncompliant hospitals.
Study limitations include that we were unable to ascertain certain granular data, such as hospital payer mix or patient out-of-pocket costs, which vary across plan designs. Additionally, prices for these 10 oncologic procedures may not be generalizable to other services. Nevertheless, our findings suggest that CMS should consider policies to avoid regressive financial penalties2 on hospitals caring for disadvantaged populations. Instead, policies should promote capacity to help patients make financially informed care decisions with increased technical support or targeted funding for information technology modernization.
https://jamanetwork.com/journals/jamanetworkopen/fullarticle/2847641
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