Hospital Price Transparency: Why It’s Not Helping Patients Shop for Care
The push for greater health care price transparency, a policy championed by both sides of the aisle, may be yielding unintended consequences. Even as the intention is to empower patients to shop for better deals on medical services, early evidence suggests that the primary beneficiaries are not individuals seeking affordable care, but rather the health systems and insurance companies leveraging the data for contract negotiations. This dynamic raises questions about whether current transparency efforts are truly serving the public interest, or simply shifting leverage within the industry.
The idea of readily available pricing in healthcare gained traction during the Trump administration, with a 2019 directive requiring hospitals to publish their standard charges online. President Trump reiterated this commitment in late 2025, proposing policies to fine hospitals that didn’t comply. More recently, President Biden has also taken steps to strengthen these rules, focusing on data standardization and enforcement. However, despite these efforts, compliance remains patchy, and the data itself is often difficult for patients to interpret.
The Data’s Limited Use for Patients
One of the core challenges is the complexity of healthcare pricing. Unlike a straightforward purchase like a television, the cost of a medical procedure isn’t fixed. It varies significantly based on insurance contracts, the specific services rendered, and unforeseen complications. As Jamie Cleverley, president of Cleverley and Associates, a firm advising healthcare providers, explained, the variation stems from the lack of standardization in contracts and presentation of pricing information. “They’re not being nefarious,” Cleverley said, emphasizing that the complexity is a byproduct of a fragmented system.
A 2021 study co-authored by Yale health economist Zack Cooper further illustrates this point. The research found that patients needing an MRI often passed by six lower-priced providers on their way to an appointment, simply following their physician’s recommendations. This suggests that patient behavior isn’t driven by price shopping, but by trust in their doctor’s guidance. The study, published in Health Affairs, highlights a fundamental disconnect between the policy goal of informed consumers and actual patient behavior.
Industry’s Strategic Use of Transparency Data
While patients struggle to utilize the price data, health systems and insurers are actively incorporating it into their negotiations. Eric Hoag, an executive at Blue Cross Blue Shield of Minnesota, confirmed that the insurer uses the transparency data to ensure competitive rates with providers. “We use the transparency data…to make sure that we are competitive…against other health plans,” Hoag stated.
This trend is further fueled by companies like Turquoise Health, which specialize in assembling and analyzing the publicly available price data. Marcus Dorstel, an executive at Turquoise Health, noted that their clients—both payers and providers—primarily use the data for contract negotiations. “I think nine times out of 10 you will hear them say that the price transparency data is a vital piece of the contract negotiation now,” Dorstel said.
The data is also being used in more assertive ways. Some providers are even filing lawsuits against insurers, leveraging the transparency data to challenge reimbursement rates, as reported by Doximity OpMed.
Compliance and Enforcement Challenges
The effectiveness of price transparency policies is also hampered by inconsistent compliance. A study conducted in the first ten months after the initial rule took effect found that only about a third of hospitals were fully compliant. The Centers for Medicare &. Medicaid Services (CMS) has issued notices to 27 hospitals for non-compliance, and has proposed increased fines and more detailed data requirements. You can find more information about CMS enforcement actions here.
Despite these efforts, the data often remains difficult to navigate. Hospitals may present pricing information in complex spreadsheets, requiring a deep understanding of billing codes to decipher. The American Hospital Association argued in July 2025 that hospitals face challenges in applying complex contracting terms and assessing historical data to create accurate price estimates.
What’s Next for Price Transparency?
The current trajectory suggests that the initial hopes for patient-driven price shopping may not materialize. Instead, the focus is likely to shift towards refining the data quality and enforcement mechanisms. CMS is continuing to explore ways to standardize data reporting and increase compliance. Further research is needed to understand the long-term impact of price transparency on healthcare costs and access.
The debate over price transparency also underscores the broader challenges of healthcare affordability. While transparency is a necessary step, it’s unlikely to be a silver bullet. Addressing the underlying drivers of high healthcare costs—such as pharmaceutical prices, administrative overhead, and the fee-for-service payment model—will require more comprehensive reforms.
For consumers, the immediate takeaway is to continue advocating for clear and accessible pricing information from their providers and insurers. It’s also crucial to understand that price isn’t the only factor to consider when choosing healthcare services; quality of care and provider expertise are equally important. Staying informed about policy changes and engaging with healthcare advocates can also help ensure that transparency efforts truly benefit patients.