May 22, 2022

Volume XII, Number 142


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May 19, 2022

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Proposal to Increase Penalties for a Hospital’s Failure to Comply with Price Transparency Rule

As discussed in a prior post, the Hospital Price Transparency Rule at 45 C.F.R. § 180.10 et. seq. (the “Rule”), requires all hospitals to provide clear, accessible pricing information about the items and services they provide by publicizing (1) the prices for 300 of their most “shoppable services” or services that can be scheduled by a consumer in advance; and (2) total charges, payor-specific negotiated rates, and discounted cash prices for individuals paying out-of-pocket.

Many hospitals claim that it is more costly to comply with the Rule than pay the penalties associated with noncompliance and numerous independent studies have showed limited compliance to date. In an effort to enforce the Rule, CMS has now proposed to amend the regulations to impose higher penalties for failure to comply.

Specifically, CMS proposed to determine penalties amounts based on the number of beds a hospital has, and as shown here:

Number of Beds

Penalty Applied Per Day

Total Penalty Amount for full Calendar Year of Noncompliance

30 or less

$300 per hospital

$109,500 per hospital

31 – 550

$310 – $5,500 per hospital

(number of beds times $10)

$113,150 – $2,007,500 per hospital

More than 550

$5,500 per hospital

$2,007,500 per hospital

The proposed penalties will go through a 60-day comment period starting August 4, and if implemented, would go into effect on January 1, 2022.

© 2022 Proskauer Rose LLP. National Law Review, Volume XI, Number 223

About this Author

Edward S Kornreich, Health Care, Proskauer Law Firm

Past long-standing Chair of the Health Care Department, Ed Kornreich is a recognized authority on the legal, regulatory and business issues related to health care services.

Elizabeth (Betsy) R. Siegel Health Care Attorney Proskauer Rose New York, NY

Elizabeth (Betsy) Siegel is an associate in the Health Care Department. Her practice focuses on representing health care clients, including hospitals, hospital systems, academic medical centers, physician organizations and other care entities. Betsy provides legal advice on a wide range of regulatory, transactional and corporate matters, including Medicare/Medicaid reimbursement, fraud and abuse compliance, managed care contracting, HIPAA and data privacy, and general corporate and business planning.

In addition, Betsy maintains an active pro bono practice, which includes...