Trump Executive Order Aims to Disclose 'Real' Costs for Health Care
President Donald Trump signed an executive order Monday that calls for upfront disclosure by hospitals of actual prices for common tests and procedures to keep costs down.
The idea is to give patients practical information that they can use to help save money. For example, if a hospital charges your insurer $3,500 for a type of echocardiogram and the same test costs $550 in a doctor’s office, you might go for the lower-price procedure to save on copays.
But insurers said the idea could backfire, prompting hospitals that now give deeper discounts to try to raise their own negotiated prices to match what high-earners are getting.
Trump’s order also requires that patients be told ahead of time what their out-of-pocket costs like deductibles and copays will be for many procedures.
Little will change right away. The executive order calls for a rule-making process by federal agencies, which typically takes months or even years. The details of what information will have to be disclosed and how it will be made available to patients must be worked out as part of writing the regulations.
That will involve a complex give-and-take with hospitals, insurers and others affected.Consumers will have to wait to see whether the results live up to the administration’s promises.
Azar pushed back against that argument, saying insurers do ultimately disclose their payment rates when they send individual patients an “explanation of benefits.” That’s the technical term for the form that patients get after they’ve had a procedure or seen the doctor.
“Every time one of us goes to a hospital, within a couple of weeks there arrives an explanation of benefits that contains the list price, the negotiated price, and your out-of-pocket cost,” Azar said. “This is not some great state secret out there.” He said “that information is out there, it just needs to be presented to patients at the right time, in the right format, so it can help drive decision-making for them.”
Trump’s executive order also calls for:
—expanded uses for health savings accounts, a tax-advantaged way to pay health care bills that has long been favored by Republicans. Coupled with a lower-premium, high-deductible insurance plan, the accounts can be used to pay out-of-pocket costs for routine medical exams and procedures.
—a plan to pull together the government’s various health care quality rating systems for hospitals, nursing homes, and Medicare Advantage plans, improving reporting of information to consumers.
—more access by researchers to health care information, such as claims for services covered by government programs like Medicare. The data would be stripped of details that could identify individual patients.
Original content can be located at Real Clear Politics