Hospitals and health systems have been forced to post their prices for some 300 services since the start of 2021 thanks to a recent price transparency rule.
The impact of that rule––and its impact on healthcare providers––has been the target of controversy since its proposal. Providers were so up in arms about the rules that they were granted extensions to meet the deadlines, but they are still grappling with meeting the regulations, according to a recent report from KLAS. KLAS interviewed 66 revenue cycle leaders to better understand how healthcare providers are meeting the requirements and responding to the transparency rule.
Leaders are split on the impact of the price transparency rule, with only 5% who believe the rules will have a significant improvement on patient financial outcomes and 25% who believe there will be a moderate improvement. In addition, 26% of leaders say the rules will have no improvement, 4% see a moderate deterioration and 3% say the effect will be a significant deterioration.
“The government’s current methods are not the best way to go about things. . . . The government wasn’t specific enough to make it easy for a market analyst to use the data,” one executive director of revenue cycle, who expected moderate improvement to patient financial outcomes, said in the report. “And they sure didn’t do something that patients could use. So the rules missed the mark entirely.”
Respondents had two sticking points within the rules: “The requirement to use machine-readable files containing pricing information and the requirement to broadly publish online a master list of rates.”
Leaders described both aspects as onerous and stated there are often software difficulties involved when trying to publish the pricing information. Another criticism was that the regulations may benefit payor and provider organizations instead of patients.
While some respondents agreed the price transparency regulations are a step in the right direction and could positively impact patients, most noted significant resource investment is needed to sustain price transparency. Overall, many agree the execution of the rule has been poorly executed, with the time commitment from providers being severely underestimated.
“We need a significant number of resources to keep up with the requirements. I think the original rule said that providers would take about 80 hours to meet the regulations,” one vice president of revenue cycle said in the report. “When I read that, I couldn’t stop laughing. Meeting the requirements has taken an enormous number of resources and has added significantly to the cost of healthcare. … The situation doesn’t make any sense, and the rules are almost impossible to comply with.”
To keep up with the regulations, health systems and hospitals will have to invest in more people, processes and technology. More than half of respondents said the rules will require a significant amount of resources, with the initial build-out and template creation for every service being especially burdensome.
To comply with the regulations, many providers have turned to third-party solution providers rather than their in-house EMR vendors, which are expected to gain more market share regardless.
Despite the confusion and burdens around the regulations, providers aren’t likely to find relief anytime soon. Price transparency has been an ongoing goal of the Centers for Medicare & Medicaid Services (CMS), and while many organizations are only doing the bare minimum to comply with the current regulations there could be more requirements down the road. Many respondents stated they are not investing in forward-looking price transparency rules as the current rules could still change.
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Amy joined TriMed Media as a Senior Writer for HealthExec after covering home care for three years. When not writing about all things healthcare, she fulfills her lifelong dream of becoming a pirate by sailing in regattas and enjoying rum. Fun fact: she sailed 333 miles across Lake Michigan in the Chicago Yacht Club "Race to Mackinac."