Will greater transparency lower the cost of hospital care in New Jersey?

Will greater transparency lower the cost of hospital care in New Jersey?


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Since 2021, hospitals in New Jersey and across the country have been required to list prices for all procedures so patients can shop around and potentially lower health care costs through open market competition.

But patient advocacy groups and some of New Jersey’s largest unions say the system isn’t working.

They say some hospitals are not complying with federal regulations.

Medical costs for common surgeries are often much higher than the estimated costs posted on hospital websites.

Story continues below photo gallery.

And published prices contain large amounts of data that are difficult for patients to grasp, posing a serious challenge for them to calculate out-of-pocket costs.

Now, efforts are underway at the federal level with bipartisan bills in Congress that would make it easier for patients to see more prices, and at the state level, a bill has been introduced that would increase enforcement efforts.

Premiums and deductibles rising

Last week’s hearings in New Jersey on Monday and in Washington on Wednesday put the issue in the spotlight. The benefits chief for New Jersey’s largest police union is urging lawmakers to help curb rising premiums and deductibles for his 30,000 members.

Kevin Lyons, benefits director for the New Jersey Police Benevolent Association, told the House Health Committee that health care pricing “is one of the most opaque and hidden aspects of our society, even though it accounts for one-fifth of our economy one”. Subcommittee.

But representatives of New Jersey hospitals say their transparency complies with federal Centers for Medicare and Medicaid Services regulations. The huge price spreadsheet is formatted to comply with federal rules.

Christine Stearns, a lobbyist for the New Jersey Hospital Association, said the easier-to-read estimates on hospital websites for hundreds of common procedures are difficult to calculate because nearly every patient requires varying levels of care. .

“We believe that the current CMS hospital price transparency requirements are comprehensive and already ensure a high level of transparency for consumers,” Stearns wrote in a letter to members of the state Senate Health Committee last week.

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The push for more price transparency comes as health insurance rates soar, hospital costs soar and New Jerseyans pay more in premiums, deductibles and other out-of-pocket costs.

Supporters say ease of pricing will lower prices because consumers can shop around, as they can with most services.

Stearns said the latest data showed that 70% of hospitals nationwide were in compliance by the fall of 2022, up from 27% in early 2021.

Supporters say compliance rates are much lower. Only 41% of New Jersey hospitals are in full compliance with federal regulations, said Ilaria Santangelo, research director at Patient Advocates, a national nonprofit group.

She told the state board that one of the biggest problems is that many New Jersey hospitals list “an incomprehensible amount of hyphens, dashes, spaces and various forms of non-pricing information instead of actual prices.”

New Jersey bill would enforce localization

A bill introduced by Sen. Joe Vitale, D-Middlesex, essentially replicates what federal regulations already require hospitals to do. But it gives the country enforcement powers, rather than relying on Washington to ensure compliance. The state Department of Health will monitor the prices posted by hospitals and will impose yet-to-be-calculated fines if regulations are not followed.

During a hearing last week in Trenton, several union leaders and patient advocates supported the measure, with the New Jersey Hospital Association the lone opponent. Union leaders say their members’ health care costs have increased rapidly in the past few years since the COVID-19 pandemic hit, with hospital costs bearing the brunt.

Hospital spending accounts for 44% of total 32BJ SEIU Service Workers Union Health Fund health care spending, the largest single spending category, followed by doctor’s office and urgent care visits, drugs and dental and vision benefits.

“Nothing is more important than the hospital bills we have to pay,” said Kevin Brown, state director of 32BJ SEIU, which represents 14,000 construction services workers. “We know these hospital prices continue to increase faster than all Other health care spending.”

The New Jersey Hospital Association’s Stearns told the committee the bill would do little because it would simply duplicate federal rules and create “unnecessary administrative burdens and divert patient care resources with minimal additional benefit to our patients.” “

Although the hospital association does not have data on how many of its members are in full compliance with federal regulations, its president, Cathy Bennett, said no hospital in New Jersey has been cited for noncompliance.

Santangelo of Patient Advocates said enforcement by federal authorities so far has not been enough. She told the committee the state bill would “add necessary enforcement mechanisms that are lacking at the federal level.”

Bennett said the state bill would add unnecessary costs to the health care system by forcing hospital staff to perform duplicative tasks because the measure does not comply with the latest federal requirements. “The proposed legislation adds unnecessary bureaucracy instead of clarity,” she said in a statement.

Conservatives and liberals unite on issues

Late last year, another bill introduced in the U.S. Senate called the Health Care Price Disclosure and Interpretation to Consumers Transparency Act received support from conservative Republican Senator Mike Braun of Indiana and liberal Vermont Senator Burrow. Sanders’ support.

The bill requires greater public access to all negotiated prices (such as prices with insurance companies and cash prices). Labs, imaging centers and ambulatory surgery centers also must post prices under the measure. It will provide actual prices, rather than estimated prices, for 300 services before expanding to all services by 2025.

It’s unclear whether the bill would make the data easier to understand — a common complaint among transparency supporters. The state’s two largest hospitals – Hackensack University Medical Center and Bergen-Newbridge Medical Center – have 348,298 and 496,091 rows, respectively, in their pricing spreadsheets.

Hospital and patient costs skyrocket

Many hospitals across the U.S. say their prices reflect soaring business costs. A report from the American Hospital Association said inflation combined with staffing shortages that require more expensive contract workers has led to a 17% increase in overall hospital costs nationwide between 2019 and 2022.

In New Jersey, these increases come amid a hospital construction boom. For example, Hackensack University Medical Center recently opened its $714 million Helena Theurer surgical and critical care tower, and Valley Health’s new $868 million hospital in Paramus is planned for Opened in April.

At the same time, hospitals are admitting sicker patients, whose treatment is also more expensive. Data collected by the New Jersey Hospital Association shows a 21% increase in patients with “severe or extreme” illnesses between 2019 and 2022, which the report suggests is an indirect result of delays in care due to the COVID-19 pandemic.

On the patient side, there’s a push for greater transparency at a time when health care costs are soaring. Nationwide, home insurance premiums have increased 22% since 2018 and 47% since 2013, according to the Kaiser Family Foundation.

Likewise, New Jersey taxpayers pay more, with premiums rising 21 percent last year for government employees and 15 percent for school employees, causing workers to pay more and taxpayers to pick up the difference.

Lyons, the state PBA benefits director, said in an interview that health insurance prices for the officers he represents increased 23 percent last year. While more transparency about hospital pricing may not solve all the problems, it will help slow it down, he said. It will also help his members choose the right hospital for them.

“Sunlight is the best disinfectant,” Lyons said. “But what hospitals need to do right now is very difficult to understand. They kill you with data to the point where I can’t tell you how much something as common as a colonoscopy costs.”

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