Trump administration's hospital price plan raises thorny legal questions

Hospitals and health insurance companies are likely to sue the Trump administration if it moves forward with a plan pitched in July that would require hospitals to publish their standard prices and payer-specific negotiated rates, according to Bloomberg Law.

The proposal, included in CMS' Medicare Outpatient Prospective Payment System proposed rule for 2020, could raise several important legal questions about patients' right to make informed healthcare decisions and healthcare companies' right to be competitive, according to the report.

If the proposal is finalized, hospitals and insurance companies may try to get the rule struck down by arguing their negotiated prices are trade secrets.  

The American Hospital Association said it would explore its legal options if the proposal were finalized. The group contends that the proposal "exceeds the administration's legal authority," according to Bloomberg Law.

There may be some validity to the AHA's argument, Michael Adelberg, a former CMS official who leads the healthcare strategy practice of Faegre, Baker, Daniels Consulting, told Bloomberg Law.

"I don't know if you can say to two entities 'You can engage in a contract in a competitive market, but the most important terms of that contract are public," he told Bloomberg Law. "I don't know if you can do that."

Access the full Bloomberg Law article here.

Read more about CMS' OPPS proposed rule for 2020 here.

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