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All Aboard! New Transparency Bill Heading Down the Track

September 27, 2023

We’re on a roll—like a runaway freight train. This is the third alert in a row that we are bringing on the topic of hospital price transparency. Though, at this point, it may seem like an obsession on our part, it’s really more of a reflection of how much the transparency issue has been in the news of late. In the last two alerts, we covered the recent changes to the transparency rules and then provided you the results of a “secret shopper” operation that uncovered price discrepancies. Now, we have another reason to jump on the transparency train: a new bill circulating in Congress.

The Latest Locomotive

Earlier this month, a bipartisan group of legislators in Washington, D.C. submitted a new bill entitled the “Lower Costs, More Transparency Act (LCMTA).” According to a statement released by the U.S. Energy and Commerce Committee, along with two other committees (Ways and Means, Education and the Workforce), LCMTA is designed to increase healthcare price transparency and lower overall costs for patients and employers. The bill incorporates provisions advanced by leaders of all three committees, which may be an early indication of its chance for passage—at least in the House of Representatives. According to Ways and Means Chairman Jason Smith:

The Lower Costs, More Transparency Act will bring honesty and clarity to the cost of health care by requiring health insurers, hospitals, and PBM middlemen to be transparent about the prices they charge patients. It will increase access to care for patients by combating consolidation in health care delivery that drives up costs by shining a light on the increasingly common practice of vertical integration. Transparency will also give patients confidence knowing what they will pay for their health care while creating incentives to lower prices.

The chair and ranking member of the other two committees provided similar sentiments in their statements, as well.

From Engine to Caboose

A press released issued by the legislators who introduced the bill provided practical examples of how LCMTA would help the American healthcare consumer, at least from their perspective. These include the following:

Increases Price Transparency Throughout the Health Care System for Patients 

  • Empowers patients to shop for health care and make informed health care decisions by providing timely and accurate information about the cost of care, treatment, and services.
  • Requires health care price information from hospitals, insurance companies, labs, imaging providers, and ambulatory surgical centers to publicly list the prices they charge patients, building upon the Trump administration price transparency rules.
  • Lowers costs for patients and employers by requiring health insurers and pharmacy benefit managers (PBMs) to disclose negotiated drug rebates and discounts, revealing the true costs of prescription drugs.

Addresses the Cost of Prescription Drugs

  • Lowers out-of-pocket costs for seniors who receive medication at a hospital-owned outpatient facility or doctor’s office.
  • Expands access to more affordable generic drugs.
  • Equips employers with the drug price information they need to get the best deal possible for their employees.

Supports Patients, Health Care Workers, Community Health Centers, and Hospitals

  • Fully pays for investments into programs that strengthen the health care system by:
    • Funding Community Health Centers, which are crucial for patients in rural and underserved areas
    • Supporting training programs for new doctors in communities
    • Preserving Medicaid funding for hospitals that take care of uninsured and low-income patients
    • Extending funding for research to find better treatments and a cure for diabetes, which affects more than 37 million Americans

Going Off the Rails?

While supporting parts of the bill, the American Hospital Association (AHA), was clearly not pleased with every provision of LCMTA. The AHA’s executive vice president, Stacey Hughes, issued a letter to House leaders in mid-September, outlining some of the organization’s concerns:

The AHA supports the suspension of the Medicaid disproportionate share hospital (DSH) reductions for two years and appreciates your work to include this provision, however hospitals and health systems strongly oppose efforts to include permanent site-neutral payment cuts. In addition, the AHA has serious concerns about the added regulatory burdens on hospitals and health systems from the provisions to codify the Hospital Price Transparency Rule and to establish unique identifiers for off-campus hospital outpatient departments (HOPDs).

The AMA communication contained other comments about the bill that were less than glowing. To see the entire AMA letter concerning the proposed legislation, please click on the following link: AHA Comments on House Proposed “Lower Costs, More Transparency Act” | AHA. So, while not everyone is completely on board with this latest transparency measure, this train is out of the station and is so far on track. We’ll have to wait and see if it reaches its intended destination.

With best wishes,

Chris Martin
Senior Vice President—BPO

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