CEO Message

CEO Message: Flawed Price Transparency Rule Continues to Advance

Last week, America’s hospitals faced a challenging day in an appeals court in Washington, D.C., where a panel of judges appeared skeptical of legal arguments in the American Hospital Association’s (AHA’s) attempt to overturn a federal rule requiring hospitals to disclose confidential, privately negotiated payment rates with insurers —  a fight we are in together.

If the rule is not struck down, it will go into effect on Jan. 1, 2021. It is not clear when the court will issue a decision, but one is expected ahead of the effective date.

And, if the rule does go into effect, let’s be clear: the information should be no surprise to anyone.  News flash — negotiated rates between hospitals and insurance companies will vary dramatically across California and across the nation.  

Looking under the hood of this car won’t look like a Tesla. Rather, it will feel like you are looking at your father’s Oldsmobile V-8 engine. The agreed-upon payment rates between providers and insurers are built on decades of negotiations and positioning in a fee-for-service world. They vary dramatically due to the diversity of hospitals and insurers, the size of the populations served, the geography of the area served and the types of services provided. They vary dramatically due to history and positioning and differing market dynamics. Some of those agreed-upon payment rates have been fair for hospitals, others have been anything but fair for hospitals.

Much like the release of the Dartmouth Atlas some 20 years ago and its look at variations in the use of health care resources, a look at hospital/insurer negotiated rates will raise questions about variation in rates, but help little in informing an understanding of which levels are appropriate.

While hospitals support providing consumers with accurate, relevant information to help them assess the overall value of a health care service, and California is a national leader in doing so, we will continue to work with AHA to seek a delay of the requirements, as major concerns with the rule have not been addressed. These include:

  • Requiring hospitals to provide detailed information on the thousands of negotiated payment rates with insurers does nothing to help consumers understand what they care about most — useful information about their out-of-pocket costs for the care they will receive. 
  • The rule could actually drive prices up, as hospitals become aware of competitors’ negotiated rates and are disincentivized to offer discounts for large numbers of insured patients.

In the meantime, it’s important that hospitals work toward a good faith compliance effort. To support this work, CHA has created an online resource page that includes a detailed summary of the final rule and a 90-minute recorded webinar with the law firm of Hooper, Lundy & Bookman to help prepare for implementation.

We’ll continue to keep you informed of any action by the court and any movement on the work to delay this problematic rule.

~ Carmela

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Finance

CHA News Article

HHS Announces Modifications to Provider Relief Fund Reporting Requirements
For CFOs, finance & reimbursement staff, government relations staff

Earlier today, the U.S. Department of Health and Human Services issued a memorandum indicating changes to the Sept. 19 Provider Relief Fund reporting requirements. CHA is currently reviewing these modifications and their impact on hospitals. Stay tuned for more information.

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Medicare

CHA News Article

CMS to Delay Radiation Oncology Model Implementation Until July 2021
For CFOs, CMOs, government relations staff, strategic planning/development staff 

The Centers for Medicare & Medicaid Services has announced it intends to delay implementation of the radiation oncology model until July 1, 2021, via future rulemaking.  

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COVID-19

CHA News Article

California Releases COVID-19 Vaccination Plan
For CEOs, CNOs, COOs, CIOs, CMOs, and staff in government relations, human resources, licensing & certification, infection prevention, quality & patient safety, disaster readiness, employee safety

On Oct. 19, the state of California publicly released its plan for administering COVID-19 vaccinations. The plan responds to questions from the Centers for Disease Control and Prevention (CDC) for every state, describing how the California Department of Public Health (CDPH) will work within state government and with local health departments and health care providers to distribute and administer the vaccine.

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Legislation

CHA News Article

AB 890 Allows Nurse Practitioners Greater Independence
For CEOs, CMOs, CNOs

Assembly Bill (AB) 890 (Wood, D-Santa Rosa), which was signed into law on Sept. 29, will authorize a nurse practitioner who meets certain requirements to practice without physician supervision. The new law will improve access to health care by allowing nurse practitioners greater freedom and flexibility to practice in communities with insufficient primary care services. Details about the changes that will be implemented with AB 890 are available here

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Governance

CHA News Article

Adventist Health CEO Scott Reiner Elected 2021 Chair of the CHA Board of Trustees
For CEOs, government relations executives

Scott Reiner, CEO of Adventist Health, has been elected 2021 chair of CHA’s Board of Trustees. Reiner, a registered nurse with nearly 30 years of health care leadership experience, has held various hospital CEO and system executive positions within Adventist Health since 1999, and has held the top position since 2014.  

See CHA’s news release for more about Reiner and the 2021 board. 

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Volunteers

CHA News Article

New Monthly Newsletter Spotlights Volunteers
For volunteer staff

On Oct. 21, the California Association of Hospitals and Health Systems launched Volunteer Heartbeat: The Pulse of California Hospital Volunteers, its new volunteer services newsletter. Designed for California’s hospital volunteers and volunteer program leaders, the monthly newsletter provides members the opportunity to showcase programs, share stories of gratitude, pose questions for peers, learn about educational opportunities, and more.

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Behavioral Health

CHA News Article

National Suicide Hotline Bill Signed into Law
For behavioral health directors

On Oct. 17, President Trump signed the National Suicide Hotline Designation Act into law, designating 988 as the nationwide three-digit phone number to connect people experiencing mental health crises to the National Suicide Prevention Lifeline.  

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CMS News Roundup

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Education

Publication

CHA Education Events

For more information about CHA education programs, visit www.calhospital.org/education.

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