Finalized Health Care Price Transparency Rule Unveiled

Under a rule finalized by the White House, hospitals will soon have to share price information they have long kept obscured, including how big a discount they offer cash-paying patients and rates negotiated with insurers. In a companion proposal, the administration announced it is also planning to require health insurers to spell out beforehand how much patients may owe in out-of-pocket costs for all services.

The hospital rule is part of an effort by the administration to increase price transparency in hopes of lowering healthcare costs on everything from hospital services to prescription drugs. The information required to be disclosed includes gross charges, negotiated rates and cash prices for the thousands of services offered, which will be required to be updated annually. The rule also requires each hospital to include a list of 300 “shoppable” services, described in plain language, with all the ancillary costs included. It is slated to go into effect in January 2021.

Under the proposed insurer rule, insurers would have to disclose the rates they negotiate with providers such as hospitals. They would also be required to create online tools to calculate for individual consumers the amount of their estimated out-of-pocket costs for all services, including any deductible they may owe, and make that information available before the consumer goes to the hospital or doctor. That rule would go into effect one year after it is finalized, although it is not known when that will occur.