Healthcare Transparency: What Did the Executive Order Do?

June 28, 2019

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President Trump signed an executive order on June 23, 2019, to increase healthcare transparency. The order requires negotiated rates to be posted in a consumer-friendly way, increases access to de-identified claims data, requests a strategy for developing common quality measures and requires changes in high-deductible plan health savings accounts (HSAs) and flexible spending accounts (FSAs).

Transparency on Negotiated Rates

Within 60 days, the Department of Health and Human Services (HHS) must propose a rule that would require hospitals to post “actual” charges — those based on rates negotiated between insurance companies and providers for shoppable items or services. “Shoppable items or services” is defined as common services or items available from a variety of providers that can be researched and compared ahead of time.

The information must be posted in a consumer-friendly way and in a machine-readable format to allow comparisons across hospitals. Hospitals would have to update the posted information and establish a monitoring mechanism to ensure compliance.

Within 90 days, HHS, the Department of the Treasury and the Department of Labor must issue an advance notice of proposed rulemaking to ask for public comment on how providers, health insurers and self-insured group health plans could be required to disclose information about out-of-pocket costs for various healthcare items or services before a patient receives care.

MWC analysis: Agencies must ask for public comment, but are not expressly directed to move forward with a policy proposal.

Within 180 days, HHS, the Department of Justice and the Federal Trade Commission must issue a report about ways the federal government or the private sector impede healthcare price and quality transparency. The report should include recommendations for eliminating those barriers.

MWC analysis: This section appears to be directed at provider consolidation.

Quality Roadmap

Within 180 days, HHS, the Department of Defense and the Department of Veterans Affairs must develop a “Health Quality Roadmap” that aims to align and improve reporting on data and quality measurements, align inpatient and outpatient measures and eliminate low-value or counterproductive measures. This would include Medicare, Medicaid, CHIP, the VA health system and military health programs.

MWC analysis: This may be problematic among some stakeholders who have worked to have specific measures included related to specific population health issues.

Increasing Access to Data

Within 180 days, HHS — in consultation with the Treasury Department, Labor Department, Veterans Affairs and the Office of Personnel Management — must increase access to de-identified claims data from taxpayer-funded healthcare programs. The goal is to make this data available for researchers, providers, entrepreneurs and others to facilitate the development of tools that empower patients. Such data may be derived from the Transformed Medicaid Statistical Information System and other sources.

HHS also must make a list of priority datasets that, if de-identified, could advance the policies laid out in the executive order.

Changes to High-Deductible Health Plans, HSAs and FSAs

The executive order requires the Treasury Department to make three changes related to the regulation of high-deductible health plan HSAs.

  • Within 120 days, the Treasury Department must issue guidance to expand the ability of patients to select high-deductible health plans that can be used with an HSA and that cover low-cost preventive care before the deductible for medical care that assists in maintaining health status for individuals with chronic conditions.

    MWC analysis: This provision appears to require these plans to cover pre-deductible low-cost preventive care and care that helps individuals with chronic conditions maintain their health.

  • Within 180 days, the Treasury Department should issue guidance to increase the amount that can be carried over in an FSA if funds are unused from year to year.
  • Within 180 days, the Treasury Department is to propose new regulations to treat certain expenses as eligible medical expenses for the purposes of direct primary care arrangements and healthcare-sharing ministries.

    MWC analysis: It appears that the purpose of this section is to allow HSAs and potentially other arrangements to be used on a tax-advantaged basis to fund costs associated with direct primary care arrangements and  healthcare-sharing ministries.

    The Affordable Care Act clarified that direct primary care medical homes that meet certain federal standards can be used in conjunction with a qualified health plan. About half of the states exempt direct primary care arrangements from state insurance laws. The IRS has taken the view that the fees related to stand-alone direct primary care arrangements do not qualify as a recognized medical expense. In 2018, the House of Representatives passed legislation that would have treated direct primary care arrangement fees as medical expenses.

Surprise Medical Billing

Within 180 days, HHS must submit a report to President Trump on additional steps the administration could implement to address the principles announced on May 9, 2019, around surprise billing.

MWC analysis: Congress is currently working on legislation related to surprise billing.