Commonwealth Fund May 17, 2022
Toplines
Evidence from the Medicare Advantage program demonstrates that using price caps on out-of-network hospital services indirectly influences negotiated rates for in-network services
Caps on prices for out-of-network hospital care represent a low-intensity regulatory intervention that can produce in-network price reductions without the need to regulate in-network rates directly
Abstract
- Issue: Hospitals’ negotiating leverage with commercial insurers and self-funded health plans has led to high and rapidly rising hospital prices. This had led to escalating interest in addressing high prices, including through government intervention in cases where markets have failed.
- Goal: To propose a model of price limits, or caps, on out-of-network hospital services and describe the characteristics, benefits, and limitations of such an approach.
- Method: Review of published...
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