Verma Slams Nonprofit Hospitals That Sue Patients for Payment

CMS administrator also trumpets new hospital, insurer transparency rules.

This article was first published on Tuesday, November 19, 2019 in MedPage Today.

By Shannon Firth, Washington Correspondent, MedPage Today.

WASHINGTON -- Centers for Medicare & Medicaid Services Administrator Seema Verma blasted nonprofit hospitals for suing patients, plugged new price transparency rules, and blamed the uptick in the nation's uninsured rate on the Affordable Care Act, during an interview and panel discussion at the U.S. News & World Report Healthcare of Tomorrow summit Tuesday.

"We're hearing more and more stories about hospitals that are going after patients that don't have health insurance and ... they're [nonprofit] hospitals. They're taking people to court over prices that they would never charge anybody else," Verma said during a Q&A with Brian Kelly, U.S. News editorial director and executive vice president.

Nonprofit hospitals should not be suing patients who can't pay and they especially shouldn't be doing so if they aren't posting their charges online for the public to see, she said.

To that end, Verma touted two new CMS rules released Friday that focus on price transparency. The first targets hospitals and is slated to take effect in 2021; the second is still in draft form and addresses price transparency among insurers.

The hospital-focused rule would require systems to provide prices upfront for at least 300 "shoppable" services, such as hip replacements, in a patient-friendly format.

The second rule would allow patients to know the precise status of their deductible, and what their out-of-pocket costs would be for a particular service.

Some hospital groups and insurers have argued that revealing privately negotiated rates would push premiums and prices higher.

But Verma said the rules' critics are only defending the "status quo" because it serves them, and that hiding their prices simply allows them to "take advantage" of the consumer.

Prices in New Hampshire fell after the state developed its own all-payer database and made prices visible online, she said.

"I think the evidence shows [that when prices are made public], people will shop around. Not everybody ... but it's enough to potentially make the market respond with lower prices and increasing competition," she stated.

Verma was asked how CMS will respond if the Trump administration succeeds in eliminating the entire ACA in Texas v. United States of America.

Verma defended the lawsuit, arguing that the ACA has driven up premiums by over 200% for some beneficiaries and created "a new class of uninsured" -- those living at 300% and 400% of the federal poverty level who don't receive subsidies and therefore can't afford coverage.

A recent report from the Georgetown University Health Policy Institute focused on rising uninsurance rates among children and blamed the increase on the loss of public coverage.

Verma also pledged that "whatever comes out of the courts," the administration would ensure that people with pre-existing conditions are protected and that there's "no disruptions in coverage."

She also theorized that some people are so frustrated with our current healthcare system, they're willing to blow it up by eliminating the insurance system entirely and instead "[giving] all control to the government."

Verma has been relentless in her criticism of "Medicare for All" -- "the greatest threat to the American healthcare system," she once said -- and public option proposals. She continued to express those same concerns, calling alternative proposals for healthcare "dangerous" and "destructive."

She said that these alternatives would increase costs, delay innovation, and threaten the sustainability of the current Medicare program.

Instead, Verma highlighted the Trump administration's priorities for healthcare reform:

• Increase price transparency
   
• Improve interoperability of the electronic health record (EHR) system, including ensuring patients' EHRs travel with them
   
• Shift towards a value-based payment system that rewards clinicians for providing better care rather than simply more services

In a panel discussion on measuring value in healthcare after the Q&A, Verma said that one core goal of the administration is to provide patients with more data, including more quality data, which she argued will promote competition. The administration has specifically asked for feedback regarding how to integrate quality data into pricing information in its proposed transparency rule for health plans.

Panelist Vivian Lee, MD, PhD, MBA, president for health platforms at Verily Life Sciences, suggested the idea of holding a community accountable for improving the health of its population. Lee suggested having health systems work together on these issues. Determining which individual patients each system is responsible for could be a challenge, but "I think that could be a very powerful driving force and it could be very, very useful," she said.

Asked whether the idea was practical, Rachel Werner, MD, PhD, professor of medicine and healthcare management at the University of Pennsylvania in Philadelphia, said that such an approach would be "complicated" in very competitive markets.

But any model holding health systems responsible for improvements to community health should focus heavily on the social determinants of health, such as access to housing, employment, and food, added Werner, who is executive director for the Leonard Davis Institute of Health Economics at the university.

"It's not a turnkey solution but I think is one worth striving for," she said.