The Hospital Value Transparency Rule (the “Rule”) turned enforceable as of January 1, 2021 and is designed to make it simpler for People to check the prices of care earlier than going to the hospital by requiring hospitals to make sure details about costs publicly obtainable. Whereas enforcement has been sluggish to take off, as of June 2022, two hospitals – Northside Hospital Atlanta and Northside Hospital Cherokee, each a part of the identical system in Georgia – now face $883,180 and $214,320, respectively, in civil financial penalties beneath the Rule.  

The Rule requires all hospitals (Medicare-enrolled establishments and non-Medicare enrolled establishments) to make public their normal prices for gadgets and providers offered by the hospital. The time period “normal prices” is outlined to incorporate every of the next:

1. Gross cost – The cost for a person merchandise or service that’s mirrored on a hospital’s chargemaster, absent any reductions
2. Discounted money worth –  The cost that applies to a person who pays money, or money equal, for a hospital merchandise or service
3. Payor-specific negotiated cost – The cost {that a} hospital has negotiated with a 3rd social gathering payor for an merchandise or service
4. De-identified minimal negotiated prices – The bottom cost {that a} hospital has negotiated with all third-party payors for an merchandise or service
5. De-identified most negotiated prices –  The very best cost {that a} hospital has negotiated with all third-party payors for an merchandise or service

“Gadgets and providers” is broadly outlined to embody “all gadgets and providers, together with particular person gadgets and providers and repair packages, that could possibly be offered by a hospital to a affected person in reference to an inpatient admission or an outpatient division go to for which the hospital has established a normal cost.” 

Beneath the rule, hospitals are required to make the usual prices for his or her gadgets and providers public in two methods (usually described):

1. By making a single digital “complete machine-readable file” publicly obtainable on-line in an simply accessible method, freed from cost, that features every sort of normal cost for all gadgets and providers offered by the hospital, up to date yearly, and
2. A “consumer-friendly” checklist of shoppable providers, together with 70 CMS-specified shoppable providers and 230 hospital-selected shoppable providers, written in plain language, simply accessible by the general public, and up to date yearly.

CMS can implement the Rule in plenty of methods, together with by reviewing complaints and analyses of noncompliance made by entities or people on to CMS and/or by auditing hospitals’ web sites. If CMS determines a hospital is noncompliant with any of the necessities of the Rule, it could assess a financial penalty to such hospital. 

CMS issued a “Hospital Value Transparency Discover of Imposition of a Civil Financial Penalty (CMP)” to each Northside Hospital Atlanta and Northside Hospital Cherokee (the “Notices”) for 5 alleged violations of the Rule: (1) failure to make normal prices public for every separate hospital location beneath a single hospital license; (2) failure to make public a machine-readable file with the checklist of all normal prices for all gadgets and providers offered on the hospital; (3) failure to make such machine readable file obtainable as one single file; (4) failure to observe CMS’ file naming conference; and (5) failure to make a consumer-friendly checklist of normal prices for “a restricted set of” shoppable providers publicly obtainable on-line. 

These Notices, nonetheless, weren’t the primary time these hospitals had heard from CMS on the matter of non-compliance, which is price noting for different hospitals not but in compliance with the Rule. According to regulation, a number of alternatives had been offered to those hospitals to take corrective motion. Over a 12 months previous to the issuance of those Notices, CMS issued every hospital a warning discover with an “alternative to reply and supply supporting documentation to CMS relating to the cited violations.” Neither hospital responded. Between 4-6 months later, CMS accomplished a overview of every hospitals’ web site and famous continued non-compliance, after which level CMS issued a “Request for Corrective Motion Plan (CAP)” to every hospital. CMS then carried out a technical help name with every hospital and offered one other alternative to submit a CAP (or revised CAP) earlier than imposing the CMPs for the above-described violations. Every hospital had 30 calendar days from the issuance of their discover to request a listening to earlier than an Administrative Legislation Choose and enchantment these CMP determinations.

Some hospitals till this level might have been weighing the prices of compliance with the Hospital Value Transparency Rule. It’s now obvious, nonetheless, that non-compliance can include a hefty price ticket. Hospitals ought to take any communication from CMS relating to Hospital Value Transparency violations critically and take steps to show a willingness to take corrective motion. 

Nicole Jobe is a member of Thompson Coburn’s Well being Legislation Observe Group.