Hospital Response to CMS Public Reports of Hospital Charge Information

Abstract

Background: In an effort to increase price transparency, the Centers for Medicare and Medicaid Services (CMS) began reporting charges for Medicare inpatients treated in ∼3400 hospitals online in 2013. As of 2019, CMS began to require hospitals themselves to publicize a more comprehensive list of their underlying procedure charges.

Objective: The objective of this study was to assess the responses of hospitals to broad-scale public reporting of their charges for inpatient services.

Research design: We used descriptive analysis to examine the trend in CMS charge data for high charge hospitals before and after the 2013 intervention. We also applied difference-in-differences analysis to comprehensive inpatient charge data from New York and Florida for the years 2011-2016, defining the reported high-volume diagnosis-related groups (DRGs) as the intervention group.

Results: At the national level, the CMS charge data showed relatively lower growth in high charge hospitals following the intervention. From the state data, we found that after 3 years, the growth in charges for reported DRGs in New York hospitals was 4%-9% lower than for unreported diagnosis-related groups. In Florida, it was 2%-8% lower.

Conclusion: Public reports of hospital inpatient charges by DRG appear to influence subsequent charges, slowing their growth.