The recent viral story of Taylor Davis, an Atlanta-area woman whom Emory Decatur Hospital billed nearly $700 for waiting in its emergency room and leaving without care, reinforces the pressing need for healthcare reform. Though the nation's broken healthcare system rarely makes it to the top of the 24-hour news cycle, it's one of ordinary Americans' biggest concerns. A new federal rule finalized this week by the Biden administration to strengthen hospital price transparency can empower patients like Ms. Davis to take control of their health finances and substantially save on their healthcare costs.
"I didn't get my vitals taken. Nobody called my name. I wasn't seen at all," Ms. Davis explained to her local Fox affiliate. So after waiting for seven hours in an effort to get treatment for a head injury, she went home. Yet weeks later, she received a facility fee from the hospital for $688. When she challenged it, the hospital representative replied, "You get charged before you are seen. Not for being seen."
This story struck a nerve with Americans who have been victimized by similar healthcare billing malpractice. It was picked up by the Associated Press and earned the top spot on Reddit's homepage with around 100,000 upvotes and more than 10,000 comments. Many of the commenters shared their own healthcare billing horror stories.
Systemwide healthcare price transparency can protect patients by providing them with financial certainty before they walk through the hospital doors. Armed with actual prices, consumers can shop for the best care at the best prices, avoiding price gouging hospitals in favor of better value alternatives. Binding prices can protect patients from widespread overbilling by giving them immediate recourse if their final bill does not match the quoted price.
When patients have choices, they can unleash a consumer-driven, competitive market that puts runaway cost trends in reverse. By empowering patients, price transparency can also spur quality, outcome, and customer service improvements. Hospitals won't be able to get away with charging patients just for sitting in the waiting room.
Federal law mandates that hospitals post their discounted cash prices and all negotiated rates by payer and plan. Yet a recent study by PatientRightsAdvocate.org finds that 94.4 percent of American hospitals are noncompliant, including Emory University Hospital, which is part of the same hospital system as Emory Decatur Hospital. These violating hospitals are profiteering off the backs of ordinary patients like Ms. Davis by blinding them to prices then blindsiding them with massive bills weeks and months later. (Tax filings show that Emory Hospital Group collected $2.7 billion in revenue in 2018.)
This week, the Biden Administration finalized a regulation significantly increasing financial penalties on noncompliant hospitals to more than $2 million per year. The rule also enacts new price disclosure standards to make price transparency more robust and accessible for ordinary consumers. These actions will incentivize more hospitals to comply and allow tech innovators to aggregate prices in easy-to-use apps that empower consumers to compare healthcare prices like they currently do for consumer goods on Amazon. Next July, a health insurance price transparency rule takes effect, requiring insurers to publish all their negotiated rates so consumers can access real prices wherever they get care.
These actions shift power to patients, putting them in the driver's seat of their health finance decisions. Price transparency will prevent hospitals from taking them for a ride. Stories of abusive billing can be replaced by those of patients shopping with their feet to dramatically reduce their healthcare costs. The resulting catharsis among long-suffering healthcare consumer readers should make these stories go viral as well.
Cynthia A. Fisher is founder and chair of PatientRightsAdvocate.org.