Pallone’s Bipartisan Bill to Deliver Transparency in Health Care and Prescription Drugs Prices Passes House

Washington, DC – Congressman Frank Pallone, Jr. (NJ-06) today led House passage of bipartisan legislation that will help consumers compare and better understand the cost of health care services across different hospitals and insurance companies. The Lower Costs, More Transparency Act strengthens transparency requirements for both hospitals and insurers by requiring them to display price information in a format that consumers can easily understand. Pallone held a press conference in June in Woodbridge with local advocates and health care leaders about the need to bring more transparency to health care and prescription drug costs. His remarks on the House floor today are available here.

The bill requires hospitals to make public all standard charges for items and services and to display charges for the hospital’s 300 most “shoppable” services in a consumer-friendly format. Additionally, the bill requires insurers to make public their negotiated in-network provider rates for all items and services, billed charges for out-of-network items and services, and personalized cost-sharing information. 

Pallone’s legislation also increases transparency of pharmacy benefit managers (PBMs) to help employers and consumers better understand drug price information and lower health care costs. The opaque contracts of pharmacy benefit managers make it difficult for employers and plan sponsors to understand drivers of cost and negotiate savings. The legislation requires PBMs to annually provide group health plans with detailed data on prescription drug spending, including the acquisition cost of drugs, total out-of-pocket spending, and additional information.    

“Patients deserve greater transparency in the prices they pay for health care and prescription drugs. Unfortunately, consumers are not able to easily obtain price information in advance, and sometimes the information that is available is inaccurate and misleading, making it difficult to determine the true value of the care. The lack of transparency makes it difficult for both consumers and employers to make informed decisions,” Pallone said. “The Lower Costs, More Transparency Act does exactly what it says it does—it delivers lower health care costs for the American people and brings much-needed transparency to our nation’s complex health care system. This bipartisan bill is a victory for everyone who has ever struggled to navigate and understand the cost of a health care procedure or a prescription drug.”

The bill will help make health care more accessible to American families by investing in Community Health Centers and programs to address the physician shortages across the nation. The legislation also includes an historic $15 billion in investments in safety net and workforce programs, including Community Health Centers and programs to address physician shortages across the country. The investments include:

• A 10 percent increase in mandatory funding for Community Health Centers (CHCs), to $4.4 billion per year for fiscal years 2024 and 2025, which is strongly supported by the National Association of Community Health Centers;
• A 13 percent increase in funding for the National Health Service Corps (NHSC), to $350 million per year for fiscal years 2024 and 2025; and
• A seven year reauthorization for the Teaching Health Centers Graduate Medical Education (THCGME) program, resulting in a 137 percent increase in funding, or $300 million per year, for fiscal years 2028, 2029, and 2030, which is strongly supported by a coalition of safety net and primary care providers;

According to an analysis by The New York Times, a single hospital can have up to a 300 percent price difference for the same service, depending on the insurer. Another analysis by the Peterson Center and the Kaiser Family Foundation found the price of a joint replacement for knee or hip surgery varied widely across the 20 largest metropolitan areas, ranging from less than $20,000 to more than $70,000.