With the recent conclusion of the 2024 election, the spotlight now shifts back to Congress as it enters the final weeks of the 118th session. While time is limited and there is much to accomplish, Congress has a critical opportunity to reshape health care affordability, enhance transparency, reduce costs, and lay a strong foundation for future reforms through the Lower Costs, More Transparency Act (LCMT) and Health Care PRICE Transparency Act 2.0. Taking action on key provisions during the lame-duck session could serve as a catalyst for addressing issues such as health care consolidation, cost disparities, and opaque pricing structures before turning the page to a new legislative chapter.
One of the LCMT’s central provisions is to build on hospital and insurer price transparency rules enacted in 2019 and increase price transparency throughout the health care system. These initiatives are supported broadly by the people, economists, and members of Congress. According to a poll conducted in September 2024, 92% of likely electorate voters nationwide supported these requirements. There is also strong bipartisan, bicameral support for price transparency initiatives as the Senate is working with the Health Care PRICE Transparency Act 2.0 introduced by Sens. Mike Braun (R-IN) and Bernie Sanders (I-VT). Both bills expand on the already different transparency rules but in different ways.
Although the 2019 price transparency regulations were a good start, many hospitals have failed to comply. A recent report found that more than one- third of 100 hospitals reviewed did not properly post machine-readable pricing data. The LCMT and Health Care PRICE Transparency Act 2.0 would mandate that hospitals and insurers disclose real prices, including cash rates and negotiated insurance rates, codifying these rules into law. The legislation aims to improve compliance and make data clearer and more accessible for researchers, consumers, and employers. It also extends these requirements to clinical labs, ambulatory surgical centers, and imaging service providers in Medicare.
For decades, despite rising health care spending in the United States, data on health care prices have been opaque. Our work has shown that rising costs often erode worker wages and other benefits, particularly for lower-income Americans, and can often also strain government finances. While not a “cure all” for rising spending, price transparency initiatives can inform policymakers and enable employers to design impactful programs and employers that could reduce spending.
The LCMT bill goes further on transparency by mandating that Medicare Advantage (MA) organizations disclose specific information to the Department of Health and Human Services regarding their shared ownership with health care providers, PBMs, and pharmacies. While it doesn’t include full ownership transparency, which would be a great next step, this call for ownership transparency for providers owned by MA plans kicks off it. Full ownership transparency should be considered in the future as it can help prevent conflicts of interest, enhance accountability, and promote competition, as our colleagues have shown in their research.
There is one more key provision of the LCMT that is not included in the Health Care PRICE Transparency Act 2.0: It takes a first step to address site-of-care payment differentials by addressing discrepancies in payments for physician-administered drugs. The provision aims to ensure that Medicare beneficiaries and the Medicare program pay the same administration rates for physician-administered drugs in off-campus hospital outpatient departments as they do in physician offices. Our research has shown that these types of site-of-care payment differentials contribute to this rise in Medicare spending and also fuel provider consolidation by creating an “arbitrage” opportunity to shift referrals to hospital-based outpatient departments.
Despite these payment differentials, our research has also found that many non-hospital settings have equivalent or better quality than hospital-based settings. By mandating that Medicare beneficiaries and the program pay the same rates regardless of the care setting, this provision could be a start to help reduce unnecessary costs, prevent incentives that drive care to more expensive settings, and presents a larger opportunity for broader site-neutral policy options in the future.
A busy legislative agenda and other pending priorities have pushed both bills to the lameduck session. Congress has the opportunity to end on a high note in health care by passing provisions from the Lower Costs, More Transparency Act and the Health Care PRICE Transparency Act. These policies represent a crucial step toward potentially reducing costs, improving competition, and leveraging data as a powerful tool to control health care spending growth. This presents a unique opportunity for Republicans and Democrats to unite on an important issue as we approach the new Congress and a new administration.
Passing some of these provisions could provide immediate benefits while laying the groundwork for future reforms. Site-neutral payment initiatives, expanded reporting requirements on health care consolidation, and greater scrutiny of vertical integration could all build upon the foundation set by this legislation. The next Congress could further advance these efforts, ensuring that our health care system remains accountable, competitive, transparent, and patient-centered.
Jared Perkins is the director of Health Policy Strategy at the Center for Advancing Health Policy through Research (CAHPR) at the Brown University School of Public Health. Christopher M. Whaley is the associate director of CAHPR and associate professor of health, services, policy, and practice at the Brown University School of Public Health.