Biden administration seeks to hike penalties for hospitals that fail to list prices

The Biden administration on Monday proposed ramping up penalties for hospitals that do not follow rules regarding price transparency.

A rule proposed by the Centers for Medicare and Medicaid Services (CMS) would potentially penalize large hospitals as much as $2 million per year for failing to make their prices public – up from $109,500 under the existing framework.

The current penalty amount would be maintained for smaller hospitals.

"As President Biden made clear in his executive order promoting competition, a key to price fairness is price transparency," HHS Secretary Xavier Becerra said in a statement. "No medical entity should be able to throttle competition at the expense of patients.

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The agency said it is seeking alternative or additional criteria that could be used to scale a civil monetary penalty, including hospital revenue; the nature, scope, severity, and duration of noncompliance; and the hospital's reason for noncompliance.

The proposed penalties would go into effect in January.

The Hospital Price Transparency rule was finalized in January of this year and requires each U.S. hospital to make public an annual list of its standard charges for services provided.

The Department of Health and Human Services noted many hospitals have failed to follow the rule.

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As previously reported by FOX Business, the Biden administration recently advanced a Trump-era rule to prevent surprise medical billing.

The rule, set to go into effect in 2022, bans surprise billing for emergency services, high out-of-network cost-sharing, out-of-network charges for ancillary care at an in-network facility, and other out-of-network charges without advance notice.

Lowering health care prices is considered one of the few areas where there is bipartisan support among lawmakers.