The American Hospital Association responded to a Centers for Medicare & Medicaid Services request for information on price transparency policy, arguing that determining accuracy and completeness of hospitals' machine-readable files is challenging and that additional enforcement is unnecessary.
What happened
The AHA submitted its response to CMS Administrator Mehmet Oz on July 21, 2025, on behalf of nearly 5,000 member hospitals, health systems and other healthcare organizations. The association addressed CMS's request for information specifically regarding the accuracy and completeness of hospitals' machine-readable files required under price transparency regulations. The AHA argued that exact rates do not exist in the way envisioned by current policy because hospitals must create estimated allowed amounts specifically for these files rather than using existing internal rate structures. The organization encouraged CMS to focus future efforts on consumer-friendly shoppable service information rather than machine-readable files, arguing that the current approach diverts attention from price transparency efforts most meaningful to patients.
The backstory
Hospital price transparency requirements took effect in 2021, with CMS changing requirements and guidance several times since implementation. Between January 7, 2021, and March 31, 2025, CMS conducted over 6,000 audits and enforcement actions related to hospital price transparency compliance as part of over 3,000 unique cases. Of these cases, almost 1,000 hospitals were found compliant at audit time, and nearly 2,000 came into compliance following CMS action. CMS has issued only 27 civil monetary penalties during this period.
Going deeper
The AHA explained that machine-readable files require hospitals to break down services in ways not common for rate negotiation or storage in hospital systems. Hospitals must make detailed assumptions about applying contracting terms and assess historic data to create reasonable expected allowed amounts. For example, developing a negotiated rate for a colonoscopy requires hospitals to use historic claims data to calculate average insurer payments, accounting for patient acuity variations, care process differences, and potential additional procedures like biopsies or polyp removal. The association noted that machine-readable data represents historic payment amounts at best and cannot account for individual patient factors or cost-sharing amounts.
What was said
In the letter to Administrator Oz, the AHA stated, "We are concerned that the ongoing focus on the machine-readable files, rather than the consumer-friendly shoppable service information, diverts attention away from the price transparency efforts that are most meaningful to patients."
The organization emphasized, "The guiding principle of price transparency policies should be providing patients with clear and accurate information to help them prepare for care."
Regarding enforcement, the AHA noted, "Given the prolific auditing and enforcement already occurring, additional enforcement of the hospital price transparency requirements is not necessary."
The letter concluded, "We urge CMS to focus future efforts to reform price transparency on streamlining policies to remove complexity and administrative burden."
In the know
Machine-readable files under hospital price transparency requirements must contain estimated allowed amounts–data that hospitals create specifically for compliance rather than using existing rate structures. Unlike negotiated rates stored in hospital systems, these files require hospitals to estimate payments by analyzing historic claims data and applying complex contracting terms. The process involves assumptions about patient acuity, care variations, and potential additional procedures that can affect final payment amounts. This creates challenges in determining accuracy since no external tool or dataset exists for CMS to verify these hospital-created calculations.
Why it matters
The association's argument that machine-readable files divert attention from more meaningful transparency tools reflects broader healthcare industry concerns about regulatory burden versus patient benefit. With CMS having conducted over 6,000 audits since 2021 yet issuing only 27 penalties, the AHA's call for reduced enforcement suggests the current approach may be achieving compliance without necessarily improving patient outcomes. The debate over focusing resources on consumer-friendly tools versus comprehensive data files could influence how healthcare price transparency evolves, particularly as the No Surprises Act requirements take full effect. Additionally, as healthcare organizations balance price transparency requirements with HIPAA compliance obligations, the AHA's push for streamlined policies could reduce potential conflicts between making pricing data publicly accessible while protecting patient health information privacy.
The bottom line
The AHA's response signals healthcare industry pushback against expanding price transparency enforcement, advocating instead for streamlined policies focused on patient-usable information. As CMS considers its approach to hospital price transparency, the tension between comprehensive data requirements and practical patient tools will likely shape future regulatory decisions. Healthcare organizations should monitor potential policy changes that could shift focus from machine-readable compliance to consumer-oriented transparency solutions.
FAQs
What are machine-readable files in the context of hospital price transparency?
They are data files hospitals must publish to show pricing information, including estimated allowed amounts for services.
Why are estimated allowed amounts used instead of actual negotiated rates?
Hospitals often don't store actual negotiated rates in a standardized way, so they create estimates using historical claims and contract terms.
What are consumer-friendly shoppable services?
These are simplified, easy-to-understand pricing tools that help patients anticipate costs for common, scheduled services.
Why is the AHA concerned about overemphasizing machine-readable files?
They believe it draws attention away from tools that better help patients understand and plan for healthcare costs.
