Amid the busy news cycle, a recent Trump administration executive order requiring health-care price transparency has gone largely overlooked.
On Feb. 25, the White House demanded hospitals and health insurers post their upfront prices, including their negotiated rates by health plan. With this information, patients in the Carolinas and across the country can finally avoid widespread price gouging, spot wide price variations for the same care, and choose affordable treatments.
This federal price transparency push is occurring in tandem with similar efforts in many states across the country. For example, the North Carolina Senate just passed Senate Bill 316, which requires hospitals to reveal their all-in prices by health plan for common procedures and warn patients about potential surprise billing if their insurer is out of network.
SB 316 also requires hospitals to issue itemized bills before sending patients to collections, making it easier for patients to identify and rectify overbilling and errors. The bill also limits “facility fees” that hospitals and their affiliated centers use to jack up charges. Unfortunately, the bill faces stiff opposition in the state House due to intense hospital-industry lobbying.
Federal and state policy is urgently needed to lower health-care costs. A new Gallup poll finds that 31 million Americans needed to borrow a combined $74 billion in 2024 to pay for healthcare. Most borrow more than $500. Studies suggest North Carolina has the highest health-care costs in the country. And a recent poll shows nearly three-quarters of state residents are worried about being charged a facility fee.
Employers, who provide most Americans with health coverage, are also getting crushed by high costs. For nearly 40 years, small businesses have said the rising cost of health insurance is their No. 1 business concern. The United States now spends $4.9 trillion annually on healthcare, 17.6% of GDP. That’s nearly twice the developed-world average.
I know the consequences of hidden health-care prices firsthand. Last winter, I came down with a nasty illness. When my symptoms didn’t improve, I went to urgent care in Chapin, South Carolina. I wasn’t concerned about the cost because I have good insurance and was only going to urgent care for a minor medical issue.
I was tested for flu, COVID-19, and strep, but the results came back negative. I was sent home to rest. With lots of fluid and a little chicken noodle soup, I got better soon after.
But then I received a bill for $803. It turns out the urgent care was part of a larger regional medical center that allowed it to charge monopolistic, hospital-style prices.
My insurance company reimbursed the facility $95, a reasonable amount considering these tests can be purchased for around $25 at a local pharmacy. Yet the hospital stuck me with the bill balance — $708.
Though I’m lucky that I could afford this charge, I refused to pay it on principle. Hospitals can’t get away with hiding their prices in order to overcharge patients.
It goes without saying that if I had known this price upfront, I would have never set foot in the clinic. I disputed the charge and threatened to sue in small claims court. Shortly after, I received a call from the hospital and settled the bill for around one-third of what I owed.
Not all patients have the resources or wherewithal to challenge outrageous health-care bills, often far higher than mine. And in America’s predatory health-care system, it seems as though everyone has an over-billing horror story.
System-wide price transparency can protect us. With access to upfront prices, we can avoid overcharges. We can select independent clinics that charge a small fraction of what they do at hospitals and hospital-affiliated centers.
Employers can steer their employees to high-value treatment and design affordable health plans. Business earnings should fund new investments and higher employee wages, not runaway health-plan premiums.
Competition will reverse runaway health-care costs as consumers migrate to high-value providers and overcharging hospitals are forced to reduce prices to maintain volume.
In short, price transparency can revolutionize American health care into a functional, pro-consumer marketplace that resembles the rest of the economy.
Don’t expect to see health policy updates on the front page anytime soon, but Trump’s health-care price transparency requirements will prove to be far more enduring than the rest of the 24-hour news cycle — especially when paired with state legislation like North Carolina’s recent Senate Bill 316.