March 12, 2021
New Orleans ACORN, Local 100 United Labor Unions, and the Labor Neighbor Research & Training Center have spent recent months with the help of two outstanding Tulane University research interns studying the compliance of hospitals with transparency rules promulgated by the federal government. We’re not finished by a long shot, but we’re getting closer and closer to a place where we can examine patterns and discrepancies. Attention to the regulation and the need to make noncompliance penalties serious suggests that it is worth providing some preview to what we’re finding.
The backstory is standard fare for American healthcare. Promotion of the transparency regulation by the Trump administration for hospital and drug pricing may be proof that every dog has its day, but it was the right thing to do for whatever the administration’s reasons, even if it was a bit of a soft touch. Nonetheless, hospitals and their association cried like stuck pigs about the burden, the cost, and generally revealed their indifference to allowing patients a peep at their marketplace, even as they railed against another step towards socialized medicine and government interference. Losing in court, they threw in the towel, meaning compliance was required beginning January 1, 2021.
Not surprisingly, some haven’t bothered. The penalties are only $300 per day, which is hardly a rounding error for many of these outfits. We found that some institutions are trying to require that you are an existing patient before you are allowed to see the prices. Yes, a violation. Some are requiring that you provide them your personal information so that they can harvest contacts for marketing purposes. Yes, another violation.
Those that do comply often do so by running a fog machine over any notion of transparency. We began our comparison shopping with a long list, but hospitals had made so many procedures an exercise in sorting apples and oranges, like listing a dozen different prices for childbirth, that we narrowed the list to ten very common procedures to try to achieve some clarity. That still didn’t make it all that much easier. When the regulation was first promulgated, experts argued that this level of transparency would still make real comparisons impossible for 99% of the public, and that may turn out to be generous.
What have we found? Well, there are some outliers in our survey area in three states, Texas, Arkansas, and Louisiana, that are humdingers in price gouging that’s for sure.
Are there patterns? Do private, for-profit hospitals charge more than nonprofits and public institutions? Is there a relationship between nonprofits that are miserly on charity care and bill padders on procedures? Is pricing market-sensitive by geography that would indicate either competition or price-fixing? Frankly, we’re not there yet, so it’s impossible to say definitively.
Bottom line to Congress and DHHS: make the regulation better, create a common list, and real penalties. Stay tuned as we dig deeper and can share more of our findings in coming months.