Two U.S. senators have introduced legislation aiming to boost healthcare price transparency, and the penalties for persistent noncompliance outlined in the bill could significantly impact hospitals’ bottom lines.
The bill, put forward by Sens. John Hickenlooper and Roger Marshall, MD, would require all negotiated rates and cash prices between health plans and providers to be accessible, according to a July 21 news release from Mr. Hickenlooper’s office.
The proposed legislation would:
- Require machine-readable files of all negotiated rates and cash prices — not estimates — between payers and providers.
- Require hospitals to post actual prices for 300 shoppable services through Dec. 31, 2026, after which the requirement extends to all shoppable services.
- Create a requirement for each patient to receive an explanation of benefits statement.
- Require providers or facilities to include a detailed itemized bill of each distinct item or service, or an all-in total price for bundled items if offered to the patient as an option.
The proposed legislation also outlines updated fine amounts for hospitals:
- Hospitals with 30 or fewer beds: up to $300 per day.
- Hospitals with 31–100 beds:
- up to $12.50 per bed per day
- $15 per bed per day after one year of continued noncompliance
- Hospitals with 101–300 beds:
- up to $17.50 per bed per day
- $20 per bed per day after one year
- Hospitals with 301–500 beds:
- up to $20 per bed per day
- $25 per bed per day after one year
- Hospitals with more than 500 beds:
- up to $25 per bed per day
- $35 per bed per day after one year
For persistent noncompliance (two or more violations within one year) CMS may impose an additional penalty ranging between:
- $500,000–$1,000,000 for hospitals with 31–100 beds
- $1 million–$2 million for those with 101–300 beds
- $2 million–$4 million for hospitals with 301–500 beds
- $5 million–$10 million for hospitals with more than 500 beds
“Customers don’t walk into a restaurant only to find out how much the food costs when they get the bill,” Dr. Marshall said in the release. “Patients should know the price of the service they need before they make any decisions.”
CMS updated its hospital price transparency guidance in May, requiring hospitals to post the actual prices of items and services, not estimates. The update comes after President Donald Trump issued an executive order Feb. 25 aimed at boosting healthcare price transparency.
CMS issued its first price transparency fines to hospitals in 2022. To date, 27 hospitals have been fined.
Read the full bill here.
