Trump Proposal Would Make Hospitals Publish Negotiated Prices

(Bloomberg) -- The Trump administration will require hospitals to publish the rates they have privately negotiated with health plans, the Centers for Medicare and Medicaid Services said Monday.

• The rule expands on an executive order signed by President Donald Trump last month. It would make hospitals publish charges for tens of thousands of items in a way that makes them easy to compare. Hospitals that don’t would face civil fines of $300 a day.

Key Insights

• It’s the most detailed and aggressive policy by Trump yet to bring more transparency to health services.

• The administration has staked much of its health-care agenda on the idea that it can improve the conditions of markets to make them function better. There’s wide variation in the prices different health plans pay for the same services. Trump wants to force those prices out into the open, with the goal that competition will bring them down.

• Lobbyists for both hospitals and insurance companies opposed the idea when Trump announced it, saying the rates negotiated behind closed doors should remain private. Expect legal challenges before the rule goes into effect in 2020.
• In some circumstances where employers have learned more about hospital prices, they’ve been able to use that information to drive health care costs down. A Colorado county with some of the country’s highest medical costs is a recent example.

Know More

• Read the proposed rule.

To contact the reporter on this story: John Tozzi in New York at jtozzi2@bloomberg.net

To contact the editors responsible for this story: Drew Armstrong at darmstrong17@bloomberg.net, Mark Schoifet, Timothy Annett

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