New Rule Requires Hospitals to Disclose Their Costs
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Hospitalization – for you or a loved one – is often a stressful time. The last thing you need is confusion about how much your care will cost.
A new federal regulation, which came into force on January 1st, is intended to bring clarity to the pricing process.
The ordinance or rule requires that all hospitals operating in the US provide patients with “clear, accessible online pricing information about the items and services they offer,” according to the US Centers for Medicare & Medicaid Services.
According to CMS, hospitals must provide their standard fees in a single digital file available online. These fees include:
- Gross costs of hospitals
- Hospitals negotiate tariffs with insurance companies
- The discounted rates that hospitals accept are accepted directly by patients paying in cash
The aim is to help consumers find services that can be planned in advance by receiving prices from multiple hospitals, according to CMS.
The federal agency expects to start checking whether hospitals are complying with the new ordinance starting this month:
“CMS plans to start testing a sample of hospitals for compliance, investigating complaints filed with CMS, and reviewing analysis of violations beginning in January. Hospitals may face civil fines for violations.”
While the hospital price transparency regime is a step forward, some experts say another recently finalized regulation that may be more helpful to consumers will not go into effect this year.
This other rule requires that insurance companies publish both the rates they negotiate with health care providers and a patient’s estimated expenses for many services, sometimes referred to as a patient’s cost-sharing. However, these requirements will not take effect until 2022, and some will not take effect until 2024.
Nisha Kurani, senior policy analyst at Kaiser Family Foundation, told CNBC:
“It can be useful to see the tariffs negotiated by the payer, but in general patient sharing is more useful.”
How to lower your healthcare costs
Knowing how much a hospital costs can make you a better health services buyer. Are you looking for other ways to cut costs? Read How Can I Cut My Healthcare Costs?
Another way to cut your spending is to open a health account. When you are eligible for an HSA, you have access to one of the best tax breaks there is. For more information on HSAs, see 3 Ways A Health Account Can Improve Your Finances.
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