Background
The economic burden of cancer care in the United States accounts for nearly 5% of its total healthcare spending, with projections set to increase by nearly 30% in 2030.1 Variation in costs for oncologic surgery is considerable, both across institutions and regions.2,3 The increased focus on variation in cancer treatment costs represents a possible target for addressing escalating healthcare costs for patients and caregivers.
The lack of transparency in healthcare pricing is a barrier to informed decision-making for patients. This is especially important for patients with cancer, whose economic burden from diminished earning potential and out-of-pocket costs is compounded by a long treatment trajectory, which manifests as financial toxicity.4 Even insured patients are burdened by direct medical costs, such as copays and payments for partially covered treatments, or indirect medical costs, such as travel, childcare, and loss of work.5–8
The American College of Surgeons Commission on Cancer (ACS-CoC) is a consortium of cancer-related organizations that has accredited >1,500 US cancer centers based on quality metrics, volume thresholds, and services offered.9 Although this accreditation reflects multiple dimensions, including clinical excellence and commitment to quality, a patient’s ability to afford care and make informed financial choices using transparent prices is not included.
The Centers for Medicare & Medicaid Services (CMS) has mandated that hospitals post accessible pricing information.10 Despite this, compliance with this price transparency rule has been low, ranging from 40% to 50%.11–14 Prior cross-sectional investigations have shown that the majority of for-profit hospitals were noncompliant with at least one of the rule’s requirements by failing to provide a chargemaster.11,12,15,16 However, the impact of these studies on the care trajectories of patients with cancer in particular remains unclear. Cancer care is longitudinal, and although rarely emergent, requires timely action and decision-making that is often anchored to a surgical episode. Understanding how hospitals negotiate payments for the appropriate surgical treatment of cancer is critical for both patients and payers given the extent to which up-front cost contributes significantly to an individual’s financial toxicity. Although prior studies have described prices and the frequency of total price disclosure for surgical services, few have compared across metrics affecting quality reporting and accreditation.17
To that end, we evaluated the rate of price disclosure for common oncologic operations by ASC-CoC accredited hospitals for the 5 most prevalent cancers: mastectomy, lobectomy, wide local excision (WLE) for cutaneous melanoma, partial colectomy, and prostatectomy.1,18 We further explored the variation in rates of disclosure across census regions and in relation to hospital operational features and indicators of financial performance.
Methods
Data Source
Hospital price and payment disclosures were obtained through the Turquoise Health research dataset, a proprietary database licensed by the eponymous analytics firm.19 Turquoise Health uses standardized and automated searching algorithms to scan hospital websites to extract pricing information, and has been used in previously published works.17,20 These price reports, which include only facility fees, are ostensibly compliant with the CMS regulation effective January 1, 2021, requiring hospitals to publicly disclose payer-specific payments for common “shoppable services,” as well as all inpatient services and procedures.10
Study Population
Hospitals evaluated and accredited by the ACS-CoC were identified using publicly available website listings. Names and institutional addresses were used to link hospitals to their 2019 Medicare Cost Reports via the Healthcare Cost Report Information System (HCRIS).21 These data are routinely leveraged by the Medicare Payment Advisory Committee (MedPAC) to inform policy recommendations around hospital operations and financial incentives.22 HCRIS data were used to ascertain hospital capacity and occupancy (total staffed beds, acute inpatient days, total discharges, and Medicare volume as a proportion of total volume) and staffing (total employee full-time equivalents [FTEs]). Operational features reflecting financial performance (total revenues, operating and total margins) and stated mission (for-profit status, teaching status), were also extracted.23 Operating margins were defined as the net revenues from patient care and other operations, minus total operating expenses, divided by net revenues. Total margins referred to the ratio of net income (the difference between total revenues from patient care and nonpatient care activities, and total costs) divided by total revenues. Markup was defined as the ratio of total charges to total costs as reported in each hospital’s HCRIS form 2552-10. Hospital occupancy was defined as the ratio of total patient days to total bed days available.24,25
Financial features were examined for outliers and/or skew, and winsorized or adjusted.22 Facilities were further categorized by their ACS-CoC classifications (Comprehensive Community Cancer Program, Community Cancer Program, Academic Comprehensive Cancer Program, Integrated Network Cancer Program, NCI-Designated Comprehensive Cancer Center Program, or NCI-Designated Network Cancer Program), which broadly reflect program structure, case volume, and services provided.9 Facilities were geocoded using a publicly available online tool (https://www.geocod.io) to identify hospital referral region, census divisions, and census regions. Data were extracted on October 9, 2021, from the Turquoise Health research dataset.
Outcomes
The primary outcome was whether hospitals disclosed prices for any of the procedures used for surgical treatment of the 5 most common malignancies (breast, lung, cutaneous melanoma, colon, and prostate).18 Assessment of compliance to the price transparency rule is not straightforward, given that previous studies have assessed it differently.11–13,16,20 To that end, we sought to use an inclusive definition, where hospitals that disclosed at least one price (and not necessarily prices of all commercial payers, Medicare Advantage, Medicaid, and cash prices along with de-identified minimum and maximum prices) were considered “compliant.” Hospitals were considered to have disclosed prices if at least one negotiated payment was identified for the CPT codes and/or Medicare Severity Diagnosis Related Group (MS-DRG) codes encompassing mastectomy, lobectomy, WLE for cutaneous melanoma, partial colectomy, and prostatectomy in the Turquoise Health research dataset (supplemental eAppendix 1, available online at JNCCN.org). The secondary outcome was the number of surgical procedure categories for which a hospital disclosed prices. To assess whether rate of compliance was different among different payers, we ran sensitivity analyses to obtain disclosure rates for at least one price in each of the payer categories (commercial, Medicare/Medicare Advantage, Medicaid, and list-price or self-pay price).
Statistical Analysis
Hospitals were categorized by whether they disclosed prices for at least 1 of the 5 procedure categories, as noted earlier. Facility features were compared using 2-sample t tests for continuous variables and chi-square tests for categorical variables. Modified Poisson regression was used to evaluate the association between hospital operational and financial features and the likelihood of disclosing prices for at least one procedure.9,26,27 All statistical tests were 2-sided, and all analyses were performed using Stata SE version 16 (StataCorp LLC). Maps were constructed using ArcGIS and ArcMap (Esri). This study was approved by the Duke Institutional Review Board.
Results
A total of 1,075 ACS-CoC accredited hospitals met inclusion criteria for analysis; 91 (8.5%) were in an Integrated Network Cancer Program or a Hospital Associate Cancer Program; 282 (26.2%) were Community Cancer Programs (treating between 100 and 500 cases per year); 490 (45.6%) were Comprehensive Community Cancer Programs (treating >500 cases per year); 171 (15.9%) were Academic Comprehensive Cancer Programs; and 41 (3.8%) were NCI-Designated Comprehensive Cancer Center Programs or NCI-Designated Network Cancer Programs. Most were teaching hospitals (n=653; 60.7%), nonprofit (n=817; 76.0%), qualified for Medicare disproportionate share hospital payments (n=972; 90.4%) and located in a county with a metropolitan population >250,000 (n=782; 72.7%) (Table 1).
Characteristics of ACS-CoC Accredited Hospitals by Price Disclosures
Rates of disclosure were also assessed by geographic region. Although the disclosing/nondisclosing rates of hospitals were comparable in the Northeast and South census regions, the West census region had a higher ratio of nondisclosing hospitals. Of 160 hospitals in the West census region, 106 (66.3%) did not disclose any prices. However, of the 294 hospitals in the Midwest census region, 120 (40.8%) did not disclose any prices (Table 1).
More than half (n=544; 50.6%) of ACS-CoC accredited hospitals did not disclose prices for any of the procedure categories. These hospitals did not differ across bed size categories, but rates of disclosure differed slightly across accreditation types, ownership, and overall CMS star rating (all P<.05). Nondisclosing hospitals had a lower proportion of teaching institutions and receipt of disproportionate share hospital payments, and a higher proportion located in a metropolitan county (all P<.05) (Table 1). Only 531 of 1,075 (49.4%) hospitals reported at least one procedure price, and 313 of 1,075 (29.1%) hospitals reported prices for all 5 procedures. Figure 1 shows the geographic distribution of all ACS-CoC accredited hospitals and the number of procedure categories for which each hospital disclosed prices for. Of the 5 procedure categories, WLE for cutaneous melanoma had the highest disclosure rate at 43.7% (n=470) and prostatectomy had the lowest at 35.7% (n=384) (Table 2). Nondisclosing hospitals also were more likely to have higher hospital margins (0.44% vs −2.03%; P=.005), higher markups (5.15 vs 4.53; P<.001), and higher occupancy rates (65.3% vs 63.2%; P=.03) (Table 3).
Geographic distribution of ACS-CoC–accredited hospital price disclosures for 5 common oncologic procedures: mastectomy, lobectomy, wide local excision for cutaneous melanoma, partial colectomy, and prostatectomy. The shade of green indicates level of pricing disclosure.
Abbreviation: ACS-CoC, American College of Surgeons Commission on Cancer.
Citation: Journal of the National Comprehensive Cancer Network 20, 11; 10.6004/jnccn.2022.7057
Geographic distribution of ACS-CoC–accredited hospital price disclosures for 5 common oncologic procedures: mastectomy, lobectomy, wide local excision for cutaneous melanoma, partial colectomy, and prostatectomy. The shade of green indicates level of pricing disclosure.
Abbreviation: ACS-CoC, American College of Surgeons Commission on Cancer.
Citation: Journal of the National Comprehensive Cancer Network 20, 11; 10.6004/jnccn.2022.7057
Geographic distribution of ACS-CoC–accredited hospital price disclosures for 5 common oncologic procedures: mastectomy, lobectomy, wide local excision for cutaneous melanoma, partial colectomy, and prostatectomy. The shade of green indicates level of pricing disclosure.
Abbreviation: ACS-CoC, American College of Surgeons Commission on Cancer.
Citation: Journal of the National Comprehensive Cancer Network 20, 11; 10.6004/jnccn.2022.7057
Rates of ACS-CoC Accredited Hospital Price Disclosure for Oncologic Procedures
Operational Features and Financial Performance Characteristics
In our sensitivity analysis evaluating rates of disclosure by payer classes, we found that of 1,075 hospitals, 432 (40.2%) disclosed commercial prices, 241 (22.4%) disclosed Medicaid prices, 362 (33.7%) disclosed Medicare or Medicare Advantage prices, and 453 (42.1%) disclosed self-pay prices. The remaining rates of disclosure broken down by payer class are in supplemental eAppendix 2.
After adjustment, several hospital features were associated with differential rates of price disclosure. Teaching status was associated with 18.5% lower relative rate of nondisclosure compared with nonteaching status (incident rate ratio [IRR], 0.815; 95% CI, 0.711–0.933; P=.003). A 1-point increase in markup was associated with a 4.8% increase in likelihood of nondisclosure (IRR, 1.05; 95% CI, 1.02–1.07; P<.001). A 10% increase in occupancy was associated with a 7.6% increase in likelihood of nondisclosure (IRR, 1.08; 95% CI, 1.03–1.13; P=.002). Finally, adjusted rates of nondisclosure differed across accreditation types. Compared with Academic Comprehensive Cancer Programs, there was no difference in rates of disclosure in NCI-Designated Comprehensive Cancer Center Programs (IRR, 1.31; 95% CI, 0.953–1.79; P=.097), but Comprehensive Community Cancer Programs had a 24.8% (IRR, 1.25; 95% CI, 1.01–1.54; P=.039) greater likelihood and Community Cancer Program designation had a 49% (IRR, 1.49; 95% CI, 1.16–1.92; P=.002) greater likelihood of nondisclosure (Table 4).
ACS-CoC Accredited Hospital Characteristics With Price Nondisclosurea Rates
Discussion
The present study had 3 principal findings that improve the understanding of price disclosure for common oncologic procedures performed at ACS-CoC hospitals. First, price disclosure rate as mandated by CMS was low, with more than half of cancer hospitals reporting no prices for any of the 5 oncologic procedures studied. Second, there was wide geographic variation in disclosure rate across the United States. Finally, markers of higher profitability and nonteaching status were associated with higher rates of nondisclosure.
Despite successive CMS mandates for hospitals to disclose procedural prices, its regulatory mechanisms have appeared ineffective.28 Hospital compliance with the price transparency mandate is low across multiple nononcologic procedures, from colonoscopies to tonsillectomies.12,29–31 Because assessments of compliance can refer both to the degree hospitals hew to the “letter of the law” or the extent to which their efforts enable patients and payers to easily find the information, assessing compliance is not straightforward. A recent research letter with focus on the former examined global compliance among all short-term acute care hospitals.15 Therefore, we elected to examine the availability of prices for 5 specific cancer operations as opposed to other services in a subset of hospitals that could reasonably be expected to have those prices available.
Current research has raised concerns of low compliance among cancer centers, focusing mainly on NCI designations.16,28,32 Our study extends these findings by demonstrating similar rates of noncompliance in oncologic procedures for common malignancies among ACS-CoC hospitals. Although the procedures we examined are “elective,” oncologic care is hardly optional. Price shopping to reduce financial toxicity is implausible currently, because these prices are both difficult to find or not available for comparison. Although there has been a recent increase in peer-reviewed literature on the wide variation of prices for surgical procedures, our study highlights the tremendous degree of missingness in the prices reported, which should precede discussions on variance.11,20,28,30,33
In response to poor adherence, as of January 1, 2022, CMS has scaled up penalties for low price disclosure rates with fines of up to $5,500 per day. Our study serves to delineate the scope of the problem that needs to be addressed with future price transparency mandates.34 In 2020, prostate, lung, and colorectal cancers accounted for approximately 43% of all cancer diagnosed in men, whereas breast, lung, and colorectal accounted for 50% of all new cancers diagnosed in women.35 Therefore, the importance of financial considerations for healthcare decisions is especially paramount for patients with a cancer diagnosis.
Second, our study found geographic variation in price disclosure among different census regions. Although price disclosure rates of ACS-CoC accredited hospitals were similar in the Northeast and South, lower disclosure rates were associated with hospitals in the West and higher disclosure rates were associated with hospitals in the Midwest. Disclosure rate has been shown to be associated with average disclosure rate of peer hospitals in the same regional market, and likely reflects market dynamics.36 Although our study did not explore the regional market competition at a granular level, the geographic variation between regions may indicate that differences in hospital competition can contribute to the decision of disclosing prices.37 These regional market forces may need to be taken into consideration when designing CMS mandates.
Additionally, we found that nonteaching status, higher hospital margin, and higher markups were associated with higher rates of price nondisclosure. These hospitals are likely to be in more competitive service markets and subsequently are hesitant to disclose their negotiated rates with payers.38,39 Even in-network patients with private insurance may be subject to higher premiums due to these markups. Currently, few regulations remain to minimize hospital markups, and this could represent an important policy lever that can aid in increasing price disclosure and minimizing financial burdens on vulnerable patient populations.40
The relationship between nonteaching status and higher price nondisclosure likely reflects the inherent differences in revenue sources. Teaching hospitals receive supplemental revenue through “training subsidies” from Medicare as institutions educating the next generation of physicians. Additionally, teaching hospitals may be more immune to the effects of price disclosure as the medical school-academic affiliation is associated with positive branding, higher quality, and lower mortality.41,42 In contrast, nonteaching hospital revenue is largely driven by clinical volume. The decision to disclose price is likely a strategic one made by hospitals concerned about the potential negative impact on service demands.
An important distinction of this study is the use of payer-negotiated prices to describe price nondisclosure. Although concerns have been raised about the compliance of price transparency regulations in special designated cancer centers, previous studies have examined mainly the availability of charge-masters, which do not reflect the true prices of medical procedures.20,28 Therefore, this article provides a more comprehensive and accurate description of the price disclosure landscape upon which policy interventions can be better applied.
Our findings have several policy implications. As cancer care costs in the United States continue to rise,43 price transparency remains a critical component in decreasing information asymmetry and supporting the market forces trend toward value-driven care. Payers and health systems can use procedure pricing information to build effective levers to potentially help steer patients toward lower-cost options.44 However, this alone is not enough to drive value, given that cost is only a part of the equation. Combining quality measures along with price knowledge will be critical. In our study, we examined price disclosure in accredited hospitals that set the benchmark for quality in cancer care across the United States. A previous study showed that compliance did not improve with increased CMS penalties.45 This reinforces our policy proposal that stronger penalties outside of monetary incentive could be even more important for increasing price transparency and decreasing the fluidity of compliance. We propose that price transparency compliance be included as a pillar in accreditation status. In the short term, this would tie pricing to quality and better inform clinical healthcare decision by patients.40 This could further facilitate payment delivery models to align financial incentives of both physicians and patients to choose higher value services more accurately.
Our findings have some limitations. First, the study leverages data collated using a combination of web crawling and manual review of hospital disclosed price reports. Errors in tabulation and reporting are presumably random but could be subject to bias.46,47 Second, our study reports on price disclosure, which is distinct from procedure-specific revenue. In this context, our study is limited in drawing conclusions on how price disclosure contributes to a hospital’s overall revenue. The price transparency rule also went into effect during a global pandemic that has impacted the profitability of many US hospital systems.48 Next, we are unable to evaluate the accuracy of the Turquoise Health database with respect to compliance of all included hospitals, because cancer centers with available price transparency may not have their data included and therefore could bias the results toward underestimating compliance rates. Different levels of CoC accreditation could also have varying levels of price transparency, which was not captured. Additionally, because the data used was for the year 2021, compliance could be underestimated as hospitals continue to improve with the enforcement of new regulations in 2022. Last, these findings may be generalizable only to the cancer center population receiving certain surgical procedures, and not broadly to all hospitals in the United States or other multimodal types of cancer treatment.49
However, despite these limitations, our study results are still relevant due to their policy implications as the current CMS mandate is actively evolving.50 Although we did not examine individual surgical quality outcomes for each procedure, the cohort of hospitals represents an accreditation process that considers outcome measures as well as surgical volume, each of which can be a proxy for overall quality.
Conclusions
Our study serves to identify the scope of price disclosure among accredited cancer hospitals and potential factors driving disclosure rates. We found that despite ACS-CoC accreditation, more than half of the cancer centers did not disclose prices for 5 common oncologic procedures, which are often elective and shoppable for patients. Additionally, disclosure rates were associated with overall hospital markup and net margins. This study has important policy implications in informing the current landscape of price disclosure for cancer care and guiding CMS mandates for price transparency as a financial toxicity mitigation tool going forward. The low compliance rates call for stricter regulations and possible inclusion of disclosure as a quality metric for ACS-CoC accreditation. These findings can help drive the momentum for value-based strategies as we create cost-conscious health systems.
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