Hospitals not adhering to CMS’s cost transparency rule may eventually find their public images tarnished by their noncompliance

• Legislators and federal regulators continue to push hospitals to make prices public under the Centers for Medicare & Medicaid Services’ Price Transparency Final Rule that went into effect on January 1, 2021.
• Mental Health America recently published their 2021 statistics on mental health and substance abuse, detailing the numbers of adults dealing with issues of mental illness, substance abuse and PTSD.
• HFMA’s Shawn Stack provides insight on the true cost of noncompliance with the price transparency rule and suggests hospital leaders review five recently passed bills addressing mental health issues that also increased funding to hospital providers.

What is the true cost of non-compliance with CMS’s latest cost transparency rule?

Legislators and federal regulators continue to push hospitals to make prices public under the Centers for Medicare & Medicaid Services’ (CMS) Price Transparency Final Rule that went into effect on January 1, 2021.

• The U.S. Department of Health and Human Services (HHS) confirms that warning letters were sent out in April to hospitals who were found to be not in full compliance with the latest transparency rule after a CMS audit was completed of hospital websites this past quarter.
• CMS states they will ultimately access penalties of up to $300 per day if hospitals don’t comply within the 90-day allowance to rectify the infractions stated in the warning letter.
• CMS states they will release names of hospitals if they are issued penalties for noncompliance. 

A spokesperson for HHS also stated that CMS “expects hospitals to comply with these legal requirements and will enforce these rules to ensure Americans know what a hospital charges for items and services.”

The HHS spokesperson also stated that CMS plans to release the names of hospitals who are penalized for noncompliance, however “releasing this information prematurely could identify hospitals that have already taken corrective actions and come into compliance after issuance of a warning letter.”

Takeaway

Although CMS has not disclosed how many hospital are not compliant with the transparency rule, start-up company Turquoise Health based in San Diego states that around 2,800 hospitals do not meet the full requirements of the regulation based on their recent web-based audits. Turquoise Health hosts a web-based healthcare price aggregator and engages directly with providers and payers to create price transparency for patients and employers.

Although the final rule clearly states CMS can fine hospitals up to $300 a day for not complying with the regulation, some hospitals are weighing the administrative costs associated with full compliance against the nominal fine accessed by the agency.

Given CMS’s newest plan to tackle noncompliance by publishing the names of those who fail to fully comply, the nominal fine accessed by CMS may not be the only price hospitals pay for noncompliance. Public scrutiny from CMS and perception issues from communities and consumer groups could cost noncompliant hospitals market share, if patients and employers view competitors as more transparent.

HFMA recommends our peer review partners from Panacea and Holliday & Associates if your hospital needs assistance with transparency optimization.

Mental health and substance use disorder remain a key focus in Washington, D.C.

Mental Health America recently published their 2021 statistics on mental health and substance abuse stating in the United States:

• 44 million people  —18% of adults — have a mental illness
• 19 million people — 8% of adults — have a substance use disorder
• 12 million people — 5.7% of adults — have post-traumatic stress disorder

Late last week, Energy and Commerce Committee Chairman Frank Pallone, Jr. (D-NJ) and Health Subcommittee Chairwoman Anna G. Eshoo (D-CA) announced that the House passed 13 healthcare bills related to mental health (MH) or substance use disorder (SUD). All 13 bills support additional funding for programs targeting MH and SUD, with five boosting funding directly to hospital providers:

1. H.R. 1205, the “Improving Mental Health Access from the Emergency Department Act of 2021,” authorizes SAMHSA to award grants to qualifying emergency departments for the purpose of supporting mental health services
2. H.R. 1324, the “Effective Suicide Screening and Assessment in the Emergency Department Act of 2021,” creates a grant focused on improving the identification, assessment and treatment of patients in emergency departments who are at risk for suicide
3. H.R. 433, the “Family Support Services for Addiction Act of 2021,” authorizes the Secretary of HHS to award grants to support family community organizations that develop, expand and enhance evidence-informed family support services for those living with substance use disorders or addictions
4. H.R. 1475, the “Pursuing Equity in Mental Health Act,” authorizes federal funding to address mental health disparities among underserved populations, including communities of color
5.  H.R. 1260, the “Bipartisan Solution to Cyclical Violence Act of 2021,” creates a grant program at HHS to support trauma centers with violence intervention and violence prevention programs

Takeaway

HFMA encourages providers to review the above House bills and determine which of these tools could be utilized as valuable supplements to their own programs aimed at providing healthier outcomes for patients living with mental illness and substance use disorders.