Houston’s largest hospitals fail to publish price lists for medical services, could face federal fines

Texas Medical Center’s largest hospitals are not fully complying with a federal mandate to publish a price list they negotiate with private insurers – information that could be used to lower the cost of health care, study finds from the Houston Chronicle.

The Centers for Medicare and Medicaid Services have asked hospitals to release the information – which includes negotiated prices for basic services such as x-rays and lab tests – before January 1, 2021, or face fines of up to at $ 300 per day. The Houston Methodist Hospital, University of Texas MD Anderson Cancer Center, Memorial Hermann-Texas Medical Center and Baylor St. Luke Medical Center had not all posted their negotiated prices on Friday.

Hospitals can charge very different prices for the same service: An August report in the New York Times found that at the University of Mississippi Medical Center, a colonoscopy costs $ 1,463 with a Cigna plan, 2,144 $ with an Aetna plan and $ 782 without insurance.

Knowing these prices could help employers like Stephen Carter, CEO of Sugar Land-based Sterling Staffing Solutions, find cheaper options for health care coverage. He and his brother co-founded the company, which supplies nurses and therapists to the home health care market 10 years ago, and every year he has to pay more for his health care plan for his employees. .

Rising costs “will definitely have an impact on our ability to hire that many people… so we’ll have to do more with less,” Carter said. “Of course, we’ll try to be creative so that our employees don’t have to suffer, but there will definitely be a lag somewhere.”

Houston hospitals are now among a minority of healthcare providers that have yet to comply. Nationally, 27% of acute care, children’s, or rural primary care hospitals have not released the required pricing data, according to data from startup Turquoise Health Co.

In a statement, CMS said it sent hundreds of warnings to non-compliant hospitals in late October, but has yet to impose fines, which will increase in 2022. up to a maximum of about $ 2 million per year for hospitals with more than 30 beds. Texas imposed additional fines of up to $ 1,000 a day in a new law that went into effect Sept. 1, but the Texas Health and Human Services Commission is still deciding how the apply.

Stephen Carter, CEO and co-founder of Sterling Staffing Solutions, which has faced rising health insurance costs for his business, poses for a portrait on Wednesday, November 17, 2021 in Sugar Land. Most of Houston’s big hospitals don’t fully comply with a federal rule that requires them to publish a price list that they negotiate with private insurers, delaying the release of information that could be used to reduce the cost of care. health, according to a review by the Houston Chronicle.

Brett Coomer, Houston Chronicle / Staff Photographer

Hidden information

Health policy experts say hospitals and insurers want their prices to remain hidden because it allows them to charge exorbitant prices. But the Texas Hospital Association says providers are working hard to comply. The process of releasing information is “much more complex than policymakers thought” when drafting the rules, the group said in a statement.

“Hospitals have been faced with the challenge of providing data regarding the cost of care for patients, as well as matching and publishing millions of lines of data related to rates negotiated with health plans,” according to part of the press release from the association. “It is not an easy task, as there are thousands of different health regimens.”

Hospitals are confused by the lack of guidance from the federal government, the association said. Some believed they had posted the required information and CMS later told them they were not, “with little or no guidance on how to correct the deficiencies,” the group said. The pandemic has exacerbated the challenge of releasing information in a timely manner, he said.

Professional associations of hospitals and insurance companies initially resisted the idea of ​​providing prices. US health insurance plans called the new measures “unconstitutional” and four hospital associations jointly sued the government in an unsuccessful attempt to block them.

Insurers and hospitals have long negotiated these prices and made deals on certain procedures, said Vivian Ho, a health economist at Rice University. If these prices were displayed, it could bring both hospitals and insurance companies back to the negotiating table.

“They have to negotiate thousands of different prices and reset everything,” Ho said. “It’s not an exercise any of them are willing to go through. “

Insurance premiums have increased every year with the increasing cost of health care. To keep premiums affordable for Carter’s 300 employees, he had to come up with plans with higher deductibles, a strategy he says many business owners have resorted to in recent years.

“These plans aren’t as good and cost the employee more just so they can make the cost of the actual plan affordable, or somewhat similar to what it was before,” Carter said. “And again, employers are paying more now for a less attractive plan.”

Almost half of all Texans with health insurance are covered by their employer, according to the Kaiser Family Foundation. Negotiated rates could help employers pressure insurers to offer cheaper rates or direct employees to more value-for-money hospitals, economists and health policy experts say.

Carter believes the money he is spending on the rising cost of health care could be better spent by hiring more people or giving raises.

Who complies?

Federal rules require hospitals to publish pricing information online in two ways: a display of services with standard fees that the average consumer can understand, and a complete record with all services that includes the rates negotiated with each insurer. .

Of the six health center hospitals analyzed by The Chronicle, Harris Health Ben Taub and Texas Children’s Hospital appear to be the only providers to offer information in both formats.

Texas for kids offers a price estimation tool, showing consumers their out-of-pocket expenses for their specific insurance plan; and a spreadsheet showing negotiated rates for thousands of items and services. Harris Health Ben Taub offers a spreadsheet which shows the negotiated rates and a separate file with standard fees intended to be user-friendly.

But there is no way to know for sure whether these hospitals should change their data. CMS declined to say if they are in full compliance, adding that the agency will not identify hospitals until they have been fined, according to a statement.

The other four hospitals – Houston Methodist, Memorial Hermann, MD Anderson, and Baylor St. Luke’s – only offered tools for estimating the price or the spot price of each service without insurance. They didn’t list the negotiated rates, which experts say is the most important thing.

“To unlock a competitive market, you need to have the rates negotiated with the hospital by each health insurer and each health plan,” said Cynthia Fisher, founder and president of Patient Rights Advocate, a nonprofit advocacy organization. for price transparency.

In statements to the Chronicle, Baylor St. Luke’s and Memorial Hermann said they are working quickly to add these rates. St. Luke’s offers the information for three hospitals outside of Houston and plans to release the information for its Texas Medical Center campus “within the next few months.” Houston Methodist said it could not come up with a timeline for releasing the information. MD Anderson declined to offer a timeline.

Even if hospitals publish all the required information, there is no guarantee that prices will go down, said Ho, the health economist.

Employers should put more pressure on insurers to offer better plans, showing examples of hospitals offering more affordable rates to other insurers for the same procedure, she said.

The law may not be a catch-all solution to a tangled health system, Ho said, but it is the first step towards clarity.

“Healthcare has become so complicated that your average citizen doesn’t understand it,” Ho said. “And without this information, it’s even more difficult to explain to people why they’re not getting a good deal.”

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