White House Issues Executive Order on Healthcare Price Transparency

June 2019 ~

On June 24, the president signed an executive order on price transparency in health care that seeks to lower patient health care costs by providing prices for treatment prior to services being rendered.

As seen in Section 1, the executive order is serves “to enhance the ability of patients to choose the healthcare that is best for them. To make fully informed decisions about their healthcare, patients must know the price and quality of a good or service in advance.” According to the policy summary, the Federal Government “aims to eliminate unnecessary barriers to price and quality transparency; to increase the availability of meaningful price and quality information for patients; to enhance patients’ control over their own healthcare resources; and to protect patients from surprise medical bills.”

Informing Patients about the Cost of Care

Under the executive order, the Department of Health and Human Services (DHHS) will require hospitals and insurers to disclose negotiated rates for services, as well as provide patients with out-of-pocket costs before their procedures.

The Secretary of HHS has been directed to propose the rule, within the next 60 days, which will require hospitals to post standard charge information based on negotiated rates for common or shoppable items or services. This would include charges for services, supplies, or fees billed by the hospital or provided by hospital employees. Hospitals will be required this information to be regularly updated and made available to the public, via a machine-readable format, to ensure compliance, enable easy access to patient information, as well as comparisons across hospitals.

The executive order also seeks to improve patient access to information about expected out-of-pocket costs. The administration seeks to make data available to researchers and health care providers that will “help them develop tools to provide patients with more information about health care prices and quality.”

Within 90 days, the Secretaries of HHS, Treasury, and Labor are directed to issue an advance notice of proposed rulemaking, consistent with applicable law, soliciting comment on a proposal to require healthcare providers, health insurance issuers, and self-insured group health plans to disclose information about out-of-pocket costs for various health care items or services before a patient receives that care.

Establishing a Health Quality Roadmap

Also within 180 days of the order date, the Secretaries of HHS, Defense, and Veterans Affairs are required to develop a Health Quality Roadmap (Roadmap) that is intended to align and improve reporting on data and quality measures across Medicare, Medicaid, the Children’s Health Insurance Program, the Health Insurance Marketplace, the Military Health System, and the Veterans Affairs Health System.  Under the order’s instruction, the Roadmap shall include a strategy for establishing, adopting, and publishing common quality measurements; aligning inpatient and outpatient measures; and eliminating low-value or counterproductive measures.

Increasing Access to Data to Make Healthcare Information More Transparent and Useful to Patients

Within 180 days, the Secretary of HHS, in consultation with the Secretaries of the Treasury, Defense, Labor, and Veterans Affairs, and the Director of the Office of Personnel Management, have been instructed to “increase access to de-identified claims data from taxpayer-funded healthcare programs and group health plans for researchers, innovators, providers, and entrepreneurs, in a manner that is consistent with applicable law and that ensures patient privacy and security”.

As part of this process, the Secretary of HHS will provide a list of priority datasets that, if de-identified, could advance the policies set forth by this order, and shall report to the President on proposed plans for future release of these priority datasets and on any barriers to their release.

Empowering Patients by Enhancing Control over Their Healthcare Resources

Within 120 days of the date of the order, the Secretary of the Treasury, to the extent consistent with law, will issue guidance to expand the ability of patients to select high-deductible health plans that can be used alongside a health savings account, and that cover low-cost preventive care, before the deductible, for medical care that helps maintain health status for individuals with chronic conditions.

Within 180 days of the order, the Secretary of the Treasury, to the extent consistent with law, is required to propose regulations to treat expenses related to certain types of arrangements, potentially including direct primary care arrangements and healthcare sharing ministries, as eligible medical expenses under section 213(d) of title 26, United States Code.

The Secretary of the Treasury is also required, within 180 days of the order, to issue guidance to increase the amount of funds that can carry over without penalty at the end of the year for flexible spending arrangements.

Addressing Surprise Medical Billing

Additionally, within 180 days of the date of the order, the Secretary of HHS, in consultation with the Attorney General and the Federal Trade Commission, has been instructed to issue a report describing the manners in which the Federal Government or the private sector are impeding healthcare price and quality transparency for patients, and providing recommendations for eliminating these impediments in a way that promotes competition.

This report will explore the potential reasons as to why, under current conditions, lower-cost providers generally avoid healthcare advertising and will determine further regulatory steps that need to be taken to address surprise billing, as well as ways recommendations for eliminating cost transparency barriers and promoting competition, according to HHS Secretary, Alex Azar.

“Improving transparency in healthcare will also further protect patients from harmful practices such as surprise billing, which occurs when patients receive unexpected bills at highly inflated prices from out-of-network providers they had no opportunity to select in advance.” The president states in the order. “Making meaningful price and quality information more broadly available to more Americans will protect patients and increase competition, innovation, and value in the healthcare system.”

Source(s): Modern Healthcare; New York Times; Health Affairs; The White House;