Hospitals Sue To Stop Transparency Rules

AHA is using a "compelled speech" argument used by drugmakers
Robert Calandra

As expected, the American Hospital Association and other industry groups have filed suit to block the Trump administration from forcing them to disclose secret rates.

The lawsuit was filed in U.S. District Court in Washington. The AHA is asking the court for an expedited decision, saying that hospitals could waste time and resources preparing for a rule that might later be invalidated by the court, according to the Wall Street Journal.

The rule would require hospitals to publish the rates negotiated with individual insurers for drugs, supplies, facility fees, and care by doctors who work for the hospital.  

The hospital groups say that the rule would be compelled speech in violation of the First Amendment. Drugmakers used the same argument in that industry’s lawsuit that convinced a judge to block a rule that would have required them to include prescription drug medications in television ads, the Journal noted. The lawsuit also contends that the disclosing rates goes beyond the statutory intent of the ACA.

The administration says the rule would cost hospitals more than $23 million annually in 2016 dollars. Hospital groups say the real cost would be much more.

The lawsuit shows just how concern the industry is over the regulatory requirements associated with the rule. At the same time, the Journal reports,  the lawsuit is a public relations gamble for hospitals. The hospitals  risk being criticized for being unwilling to agree to a rule that some health analysts say may benefit patients.