Iowans have won the right to know health care prices — but hospitals aren’t complying with Hospital Price Transparency Rule

As a physician-attorney, and former economist, I am acutely aware of the largely successful efforts by hospitals and health systems in Iowa to hide the cost of health care. While providing radiology services to 20 Iowa hospitals, I had firsthand contact with patients in both the largest cities and the smallest rural areas. All these patients had something in common — they had little if any information about the actual cost of their care.

This could change. The Hospital Price Transparency Rule, which went into effect in January 2021, requires all U.S. hospitals to post their prices online so consumers can shop and compare prices before they get care. However, most U.S. hospitals are not complying with these requirements. Worse than that, hospitals along with their state and national organizations are fighting to kill this rule.

A report released last month by a national nonprofit organization showed that the vast majority (94.4 percent) of U.S. hospitals, including several in Iowa, were not complying. For the few that are, many are providing the pricing data in complicated computer files that are difficult to access and understand. Patients struggle to find actual prices, including information showing discounted prices for patients paying cash, or actual negotiated prices between insurance plans and hospitals. This interference needs to stop, now.

Hospitals further sidestep the transparency obligation by offering nothing more than an “estimator tool” rather than providing actual prices. Without knowing the actual cost of care, how can patients look for the best value for any hospital service? It would be like going to the checkout counter, and not knowing the price of anything you just purchased. In my specialty, the cost of an MRI or CT can vary between hospitals by thousands of dollars for exactly the same test.

Currently there are few penalties for hospitals not following the rule, around $300 a day for non-compliance. That must change, now. Increasing the penalties for non-compliance should be dramatically increased.

I have written to Iowa Attorney General Tom Miller and to state lawmakers asking for help in enforcing the transparency law. I’m urging them to support price transparency efforts by offering formal comments to the Centers for Medicare and Medicaid through the 2022 Medicare Hospital Outpatient Prospective Payment System and Ambulatory Surgical Center Payment System Proposed Rule (CMS-1753-P) process. Our representatives and rule makers must understand why this rule is important, and why we strongly support its robust enforcement.

And what do we gain from all of this? Real transparency empowers health care consumers and providers by letting them know the actual cost of care beforehand. Armed with real pricing information, consumers can look for better care at lower prices. They can also see if health insurers are acting out of self-interest alone.

Price transparency would help address so much of what ails our nation’s health care system. It would help usher in competition, drive down prices, and create a functional market. Lower prices would also mean greater access to medical care, so consumers can start receiving the care they have been putting off for fear of being side swiped, or even bankrupted by unexpected high bills.

But what about quality? Only last month the Commonwealth Fund released its annual report card comparing the largest, most advanced industrial economies on health care. As is so often the case, the United States was rated dead last. This can change. Getting more information about the cost of our care is all Iowans’ right, and they should demand nothing less.

Craig E. Clark MS, MD, JD of Cedar Rapids is a member of the Association of Independent Doctors.