U.S. District Court Rejects AHA’s Claim to Halt Implementation of the Price Transparency Rule.

The Trump administration had imposed a Price Transparency Rule that forced the hospitals to disclose the prices negotiated with the insurers. The American Hospital Association (AHA) along with other hospital groups had challenged this rule, contending that it would undermine competitions and also violate their First Amendment rights. Judge Carl Nicholas at the U.S. District Court, however, just recently dismissed the challenge, making headlines.

The rule is due to be effective from Jan. 1, 2021, requiring hospitals to make public charges for 300 consumer-friendly shoppable services available to the patients. CMS will identify 70 services that will be necessary to be published while the hospital will be allowed to choose the other 230.

Nichols’ primary stance in dismissing the claim is that the rule is reasonably related to the government’s interest in reducing healthcare costs, fundamentally by providing pricing data that can facilitate the patients in making well-informed decisions about their care. “Plaintiffs are essentially attacking transparency measures generally, which are intended to enable consumers to make informed decisions,” Nichols added.

U.S. Health and Human Services Secretary Alexander Azar also applauded the decision and recognized it as a successful step towards lowering healthcare costs. Azar further commented that they will continue to provide the patients with easy access to healthcare prices, which is particularly important in turbulent times such as these. “Especially when American patients are seeking care during a nationwide public health emergency, it is more important than ever that they have ready access to the actual prices of healthcare services.”

However, the AHA plans to appeal the ruling, as evident from a statement made by Melinda Hatton, AHA General Counsel. Hatton says that they are particularly disappointed at the decision in favor of the flawed proposal to necessitate disclosure of privately negotiated prices. She further adds that this will particularly impose extra burden on the hospitals, in times when resources are already stretched thin and need to be optimized for patient care. “Hospitals and health systems have consistently supported efforts to provide patients with information about the costs of their medical care. This is not the right way to achieve this important goal.”

Patients have for long complained about being blindsided with surprise medical billing and other hidden healthcare costs. Providing them with upfront information about their treatment costs is expected to benefit them at large. The administration officials, however, are of the view that such information will only confuse them about their out-of-pocket costs and not prevent it.