Federal Programs To Disclose Some Health Care Payments
The Bush administration on Tuesday likely will announce plans to make public the prices federal programs pay for certain medical procedures as part of an effort to "push to inject more free-market principles into health care," the Wall Street Journal reports.
In the next few weeks, the prices paid by Medicare for the procedures will appear on the Medicare Web site, CMS Administrator Mark McClellan said.
The federal government later will make public additional price and quality information for several undetermined metropolitan areas, based on claims for Medicare, Medicaid and programs that provide health insurance for federal employees and the military, as well as data from private employers and health insurers (Lueck, Wall Street Journal, 3/14).
Roy Ramthun, senior health policy adviser for the White House, last week announced that health insurers in the Federal Employees Health Benefits Program and TRICARE, the military health insurance program, will have to provide prices negotiated with health care providers for a number of procedures (Schuler, CQ Today, 3/13).
HHS Secretary Mike Leavitt said the metro areas selected will have higher than average health care costs and private employers and health insurers that agree to disclose price information. Leavitt added that the price information will focus on specific physicians and hospitals (Wall Street Journal, 3/14).
According CQ Today, Bush administration officials have "repeatedly urged hospitals and doctor groups to move quickly to give consumers more data" and have "made it clear that they will push for legislation requiring health care providers to supply the information if they do not take it on themselves" (CQ Today, 3/13).
Leavitt said, "People deserve to know, they have a right to know the quality of the care they receive and its cost." However, many hospitals "have raised concerns that charges have little use to most people" because their payments are negotiated by health insurers, the Journal reports (Wall Street Journal, 3/14).
In addition, many health insurers consider prices negotiated with health providers as proprietary information, although some have begun to make the information available to members (CQ Today, 3/13).
Charlie Baker, CEO of Harvard Pilgrim Health Care, said, "As health care costs go up, and as people are expected to incur a greater share of the cost of their premiums or services, this kind of information would be useful to them in that regard."
Paul Ginsberg, president of the Center for Studying Health System Change, said, "Pushing for the posting of contract prices that traditionally have been confidential would hurt, rather than help, consumers because it would raise prices. When markets are very concentrated, disclosure often facilitates sellers charging higher prices" (CQ Today, 3/13).
In related news, Rep. Bill Thomas (R-Calif.) in a letter to Leavitt said Bush administration efforts on "a broad transparent pricing initiative that includes hospitals will fail before it starts" because "hospital charges have become so grossly inflated above their private market rates so as to be almost meaningless." Thomas said that the HHS Office of Inspector General should determine the "excessive level" for prices charged by hospitals and other health care providers to CMS programs.
Congress in 1988 provided OIG with the authority to determine the excessive level for prices charged to CMS programs, and the office proposed and withdrew regulations on the issue in 1990 and 1997, Thomas said. He added that failure to implement such regulations has cost taxpayers $9 billion in overpayments to hospitals for complex medical procedures and billions of dollars more for "excessively high charges involving other parties including durable medical equipment suppliers."
HHS spokesperson Bill Hall said that Leavitt has received the letter and plans to work with Thomas on the issue (Carey, CQ HealthBeat, 3/13).