Comment on new CMS hospital price-transparency penalty

The US Centers for Medicare & Medicaid Services (CMS) last week finalized a rule that would significantly toughen the penalty if hospitals fail to comply with the price-transparency mandate, which takes effect on January 1, 2021.

In doing so, the Trump administration has ratcheted up the pressure on hospitals to make public the prices they negotiate with private health insurers., says an expert observer.

“CMS will now require hospitals to report on a yearly basis the average rates they negotiate with Medicare Advantage plans,” explains Mark Polston, former CMS chief litigation counsel and a partner in King & Spalding’s Healthcare practice. “If a hospital fails to report that information, CMS has given itself the authority to deny all of the hospital’s Medicare reimbursement for the entire year -- a penalty that dwarfs the $300-per-day penalty CMS previously threatened," he added.