In March, my 18-year-old brother fell and broke his nose (in my experience, that’s what little brothers do). He took himself to the emergency room, to see if it was truly broken—and to find out what he should do about it. He got his answer—and a $14,000 hospital bill. Instead of a simple X-ray, he was talked into three separate CT scans, medications and other testing.
When I asked him why he didn’t inquire about the costs, he looked at me in surprise. “Wait, that’s a thing?” he asked. It’s not just a thing—hospital price transparency is the law.
Right now, only 5.6% of hospitals across the country are in compliance with the federal government’s price transparency rule, nearly seven months after its implementation. Like my brother, many Americans are shocked when they eventually see what a visit to the hospital costs. According to a Healthcare Finance article, Over 56% of adults feel like they or a close family member were overcharged when seeking medical care.
Price transparency is a bipartisan issue. The original price transparency rule was issued by President Trump and went into effect on Jan. 1. President Biden also recently issued an executive order supporting the existing price transparency rules. This has been met with widespread support, as 82% of Americans support the federal government requiring hospitals to make their prices readily available to the public.
Yet hospitals are still not posting their prices. Hospitals claim that posting their transparent prices online would be too “confusing” for the average American. This, however, is not the case. Hospitals are refusing to post their prices because then they would be unable to negotiate their prices behind the scenes. If they posted their prices online, they would be forced to charge consistent prices for the same services, as opposed to having patients pay different rates for those services. Health insurance is a major component of this dynamic, as the “middlemen” (third party administrators and insurers) also suffer these consequences once hospitals post their prices.
The idea of price transparency is that the consumer should be able to “shop” for the best price of hospital care, similar to the way we all shop for clothes, cars, etc. Price transparency will lead to better-informed consumers and patients, and eventually, higher-price facilities will start to lower their prices to become more competitive.
But even with bipartisan support for hospital price transparency, a recent KFF brief found that only 9% of adults across the United States are aware that hospitals must disclose their prices online. Americans need to know that price transparency is out there, and can considerably help them and their families find affordable health care. If you aren’t sure how compliant hospitals are within your state, you can use TPPF’s Price Transparency Compliance Index to check. As more and more people learn about the price transparency rule, the more pressure mounts on hospitals to become compliant.
Texas has already taken steps to build upon the existing price transparency order by establishing this requirement as a condition of licensure for the hospital facilities. SB 1137 has proven that Texas is not afraid to hold hospitals accountable and lead by example.
The hope is that other states will follow Texas’s lead and that America begins to see more and more hospitals comply. The days of not knowing how much you owe the hospital until you receive the bill should be over. Americans want change, and we want our hospitals to comply with federal law.
My brother learned an expensive lesson. Others shouldn’t have to learn it the hard way, as he did.