AHIP: HHS Proposed Price Transparency Rule Not Actionable, Secure

The HHS Transparency in Coverage proposed rule is not an actionable or secure method to achieving price transparency, nor is it an authorized exercise of HHS authority, AHIP argues in its comments on the proposed rule.

AHIP’s comments suggest that HHS target stoppable services, instead of revealing prices on all items. The payer group also recommends giving larger plans two years to implement any changes to the rule after finalizing them, granting smaller payers (three to five years after rule finalization, establishing functionality requirements, and implementing a technical expert panel, among other specific features recommendations.

HHS proposed the rule in November 2019 in response to President Trump’s executive order demanding greater transparency from the healthcare system.

The Transparency in Coverage proposed rule required payers to publish cost-sharing information, in-network provider negotiated rates, and historical out-of-network amounts.

The goal was to allow beneficiaries the opportunity to estimate out-of-pocket healthcare spending more accurately and prevent surprise billing and high healthcare spending. Payers would post two machine- readable files on a website of theirs for beneficiaries to access. 

However, some experts have expressed skepticism that greater transparency will accomplish that goal. Among them, AHIP has been a staunch opponent to the rule.

“Publicly disclosing competitively negotiated, proprietary rates will push prices and premiums higher—not lower—for consumers, patients, and taxpayers,” Matt Eyles, president and chief executive officer of America’s Health Insurance Plans (AHIP), said when HHS published the proposal.

AHIP does not disagree that price transparency is key to reducing healthcare spending.

“The Departments propose an ambitious goal of ensuring consumers enrolled in commercial products have access to price transparency tools that will enable consumers to make better-informed health care decisions. We share the Departments’ vision,” the organization explains.

However, AHIP asserts that the proposal is not revealing the right information to consumers and exceeds the Department of Health and Human Services’ authority to implement such a rule.

“In short, the proposed rule is contrary to statute, effects a taking of health insurance providers’ trade secrets, unconstitutionally compels speech, and is arbitrary and capricious. That is why AHIP strongly urges the Departments to withdraw the proposal to implement new machine-readable files,” AHIP comments.

The organization emphasizes its opposition to the tool which the HHS proposal prescribed, a tool which would make negotiated rates available for consumers to peruse. 

AHIP cites a Federal Trade Commission (FTC) decision that found a similar open data state law would result in “unlawful collusion,” dampened competition, and an impact on payers’ discernment in selecting providers.

The tool would potentially be a security risk, the organization adds, exposing beneficiaries’ information through third-party apps that are not required to comply with the HIPAA.

Instead, AHIP points to its own members’ price transparency tools, which most plans have already tested and implemented. 

The organization offers guidelines for the new price transparency tool. It suggests that such tools must transparently and clearly describe the service or product that the consumer will receive. The information must be personalized, up to date, and accurate for the consumer to use. And lastly, AHIP says, the tool’s information must be actionable. 

AHIP recommends that the tools provide cost and quality information as well as reflect the payer’s target population to help consumers compare plans fairly. The HHS model, in contrast, would let consumers see negotiated rates. This information is not immediately useful to the consumer, AHIP argues.

Pulling from its own experience with consumers and price transparency tools, AHIP says the HHS price transparency tool would not function well because consumers are not looking for the price of every single item. Instead, they use price transparency tools to monitor pricing on specific services. To provide a price list including every item would not properly estimate the price of goods and services for complex conditions.

Finally, AHIP says HHS should include more funding for outreach and education, since consumer utilization of existing price transparency tools has proven to be low.

“AHIP and our member companies believe that all consumers deserve access to health care information that is customized, personalized, and empowers them with timely and accurate information about cost and quality to make informed health care decisions for themselves and their families,” the letter concludes. “We are committed to working with the Departments and other stakeholders to advance access to, and utilization of, personalized information on costs through issuer price transparency tools.”