Skip to main content

CMS to Get 'Aggressive' With Hospital Price Transparency Enforcement

Analysis  |  By Jay Asser  
   February 23, 2023

The federal agency has highlighted areas of improvement to get more facilities complying with the regulation.

CMS is aware more needs to be done to achieve better price transparency compliance by hospitals and plans to take "aggressive additional steps" to make enforcement a priority.

CMS' deputy administrator and director Meena Seshamani and Center for Medicare chief transformation officer Douglas Jacobs detailed next steps for the federal agency and new compliance statistics in a Health Affairs article.

According to CMS, nearly 500 warning notices and over 230 requests for corrective action plans have been issued as of January 2023, with nearly 300 hospitals having addressed the issues to become compliant.

Since the hospital price transparency regulation went into effect on January 1, 2021, hospitals are required to make public their standard charges for items and services through a consumer-friendly display showing at least 300 shoppable services, as well in a machine-readable file.

Hospitals were slow to adapt out of the gates. In an assessment of 235 randomly sampled hospitals conducted by CMS between January and February 2021, 66% met consumer-friendly display criteria, 30% posted a machine-readable file, and 27% did both.

Those figures improved significantly in CMS' second assessment, this time of 600 randomly sampled hospitals between September and November 2022. The analysis found 493 hospitals (82%) posted a consumer-friendly display, 490 (82%) posted a machine-readable file, and 421 (70%) did both.

The second assessment came after CMS increased the penalty for noncompliance, by adjusting the maximum potential penalty from just over $100,000 annually per hospital to over $2 million annually per hospital.

"We believe the multifaceted effort that CMS has undertaken since initially implementing the regulation—including efforts to educate, monitor, and enforce the regulations with increased applicable potential penalty amounts, along with heightened public interest and scrutiny—have driven this improvement," the article stated.

Despite the improvement, that would still leave 30% of hospitals noncompliant with the law. Yet CMS has only taken action against two hospitals to date, issuing fines of $883,180 to Northside Hospital Atlanta and $214,320 to Northside Hospital Cherokee.

In an effort to streamline enforcement going forward, the article said CMS plans to shorten how much time it affords hospitals to come into full compliance. In addition, the federal agency "plans to take aggressive additional steps to identify and prioritize action against hospitals that have failed entirely to post files."

CMS' compliance statistics differ from findings by other groups, including in its Semi-Annual Hospital Price Transparency Compliance Report. That analysis of 2,000 hospitals from December 10, 2022 through January 26, 2023 revealed that 75.5% of facilities are still noncompliant.

Researchers also found significant variation in data size, which CMS acknowledged as an issue in the Health Affairs article. The agency said it will take steps to standardize both reporting of price transparency information and the machine-readable file.

Finally, CMS stated it will explore ways to make it easier for the public to find the machine-readable files, which could include mandating the centralization of information.

The article concluded: "We believe that, together with members of the public, we can further unlock the collective potential of hospital price transparency and achieve greater competition in the health care system."

Jay Asser is the contributing editor for strategy at HealthLeaders. 


Health Affairs article by CMS leaders details the agency's plan to strengthen hospital price transparency, as well as recent numbers showing compliance is on the rise.

CMS says it has issued nearly 500 warning notices and over 230 requests for corrective action plans, with nearly 300 hospitals correcting their issues to become compliant.

Stricter enforcement is one of the methods CMS is eyeing, along with standardizing the reporting of price transparency information and the machine-readable file.

Get the latest on healthcare leadership in your inbox.