AHA files initial brief in price transparency suit

AHA today urged a federal appeals court in Washington, D.C., to overturn a Department of Health and Human Services rule requiring hospitals to disclose their confidential privately negotiated charges with insurers, telling the court that the rule rests on a manifestly unreasonable statutory interpretation by the agency of Section 2718(e) of the 2010 Affordable Care Act. “From its inception, no one considered section 2718(e) the solution to patients’ understandable desire for greater transparency about what they would pay out-of-pocket for hospital services or procedures,” AHA told the appeals court. “Nine years in, the government abruptly announced that section 2718(e) empowers HHS to compel hospitals to disclose the confidential rates that each insurer and insurance plan agrees to pay for every one of the hospital’s items and services, as well as many other types of information.” 

The lower court upheld the rule, despite saying it was a “close call” in this case. In a legal challenge brought by the AHA, joined by the Association of American Medical Colleges, Children's Hospital Association, Federation of American Hospitals and several member hospitals, the lower court upheld the rule as a reasonable statutory interpretation by the agency under a legal theory announced in Chevron U.S.A., Inc. v. Natural Resources Defense Council, Inc. (1984), which instructs a court to defer to such reasonable agency interpretation. The brief will be available soon on AHA’s litigation webpage.