Do New Hospital Price Transparency Regulations Reflect Value in Arthroplasty?

Abstract

In an attempt to improve price transparency, the Centers for Medicare & Medicaid Services (CMS) now requires hospitals to post clear, accessible pricing data for common procedures. We aimed to determine how many top orthopaedic hospitals are compliant with the new regulation and whether there was any correlation between hospital charges and outcomes after total hip arthroplasty (THA) and total knee arthroplasty (TKA). The hospital websites of the top 101 orthopaedic hospitals per the US News & World Report 2020-2021 were explored to assess compliance with the price transparency requirement. We recorded the gross inpatient charge, cash price, payer-specific negotiated charge, and deidentified maximum and minimum payer rates for THA and TKA. Outcome metrics included hospital ranking and Medicare risk-adjusted arthroplasty readmission and complication rates. Although 94 hospitals (93%) posted some shoppable service information as required by CMS, only 21 hospitals (20%) were fully compliant. The mean inpatient charge for THA and TKA was $72,111 (range, $14,716 to $195,264), cash price was $39,027 (range, $2,920 to $110,858), and minimum and maximum payer rates were $16,140 and $57,949, respectively. Better hospital ranking was weakly correlated with higher charges (coefficient 0.223; P = 0.049). No correlation between charges and complications (P = 0.266) or readmissions (P = 0.735) was observed. Few hospitals are fully compliant with the new CMS price transparency regulations. We found a wide range of hospital charges for THA and TKA without correlation with complications or readmissions. Although efforts by CMS to increase price transparency should be welcomed, increased costs should be justified by quality in the era of value-based care.