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The Trump administration finalized a really interesting and potentially consequential policy today: Requiring insurers to tell you what your health care is actually going to cost in advance. https://www.cms.gov/CCIIO/Resources/Regulations-and-Guidance/Downloads/CMS-Transparency-in-Coverage-9915F.pdf
If you are surprised that you can't already learn these prices, perhaps you haven't been to the doctor in a while. Real prices for health care services are typically kept secret from patients until the bills come. And they can range widely. https://www.nytimes.com/2019/04/30/upshot/health-care-huge-price-discrepancies.html
This is one of a bunch of rules the administration has finalized that aim to improve the transparency of health care prices. A similar, related rule, that asks hospitals to publish negotiated prices, is now the subject of litigation. https://www.nytimes.com/2020/06/23/upshot/hospitals-lost-price-transparency-lawsuit.html
President Trump and his advisors think these policies could have a huge impact, by changing the way patients choose their care and the way employers choose their provider networks. https://www.nytimes.com/2019/06/24/upshot/health-care-price-transparency-trump.html
But academics are far more skeptical. Many think it is likely to have a marginal effect on health care prices, like a similar law in New Hampshire did. Here's a good @_melaevans story on that experience. https://www.wsj.com/articles/one-states-effort-to-publicize-hospital-prices-brings-mixed-results-11561555562
Some even think the measure could backfire, causing health care prices to go up, not down. https://www.nytimes.com/2019/06/24/upshot/transparency-medical-prices-could-backfire.html
That apparently contrarian view is pretty widespread--held by the CBO and the FTC, for example.
It is the subject of one of my favorite t-shirts. https://twitter.com/sangerkatz/status/1163830456963555335?s=20
It is the subject of one of my favorite t-shirts. https://twitter.com/sangerkatz/status/1163830456963555335?s=20
If you want to learn about price transparency, and New Hampshire, and Danish concrete in podcast form--of course you do!--check out this @tradeoffspod episode. https://tradeoffs.org/2020/07/07/the-price-of-care/
If only this story also included a popcorn angle.
The rule gives insurers a few years to comply. The kind of consumer tools it asks them to develop seem non-trivial to build. They will need to publish all their negotiated prices and provide individual customers with cost sharing estimates.
The hospital price rule, by contrast, goes into effect in January, assuming the courts don't stop it.
There is legal risk for both rules. Congress never passed laws requiring this kind of transparency. Like many Trump policies, judges will have to consider whether these rules are allowed under the Administrative Procedure Act. (Sorry, no tee-shirt.) https://www.nytimes.com/2019/01/22/upshot/for-trump-administration-it-has-been-hard-to-follow-the-rules-on-rules.html
One last thought: Unlike a lot of Trump health policies, this one doesn't strike me as particularly partisan. The disagreements about it don't fall along obvious ideological lines.
Ok, I lied. More thoughts: This rule hangs on language from the Affordable Care Act, a law that the Trump administration has asked the Supreme Court to eliminate. If Obamacare goes, so does the price transparency policy, along with many other things. https://www.nytimes.com/2019/07/11/upshot/trump-repeal-obamacare-innovation-authority.html
