Federal Judge Rules Against Hospitals On Price Transparency

By Consumers For Quality Care, on June 29, 2020

Federal Judge Rules Against Hospitals On Price Transparency

The New York Times reports that a federal judge has ruled to uphold a Trump administration policy that requires hospitals and insurers to publicize previously classified negotiated prices. Government officials believe the policy will lower prices for consumers.

Administration officials said more price transparency would lead to lower and more predictable prices in an industry that has huge ranges in what insurers pay for services. A simple blood test, for example, can cost $11 or $1,000. Coronavirus tests show a similar variation, with prices from $27 to $2,315.

The judge rejected arguments from hospitals that the administration did not have the authority to implement the policy and that the policy would impose “overwhelming administrative burdens” on them.

The effects on prices for consumers remain to be seen. Studies of similar policies in Europe have shown they produced mixed results. The judge acknowledged that the evidence for transparency lowering prices is not “definitive,” but he called what evidence exists more compelling than arguments against it.