As the Korean government moves to disclose uncovered treatment costs, the U.S. has also reformed pricing practices to strengthen consumer choices in healthcare.

The U.S. government has even included penalties for hospitals that fail to disclose charges.

Hong Bo-bae, a researcher at Korea Insurance Research Institute, recently published a report, "U.S. Hospital Charge Transparency Rules and Recent Trends," introducing America’s Hospital Transparency Rules, which require all hospitals to disclose their standard charges, providing some policy implications for the Korean health authorities.

According to Hong, the U.S. has an opaque hospital pricing system and wide differences in charges among hospitals, making it difficult to predict costs in advance. This reduces consumer choice and hinders competition on the provider side, leading to higher healthcare costs, the report said.

For example, the cost of a brain magnetic resonance imaging (MRI) test is about $700 on average if covered by public insurance, such as Medicare and Medicaid. But the same test costs about $2,500 on average under private health insurance. Its cash price ranges from an average of $3,300 to a maximum of $230,000, a difference of more than 70 times.

In response, the U.S. government has required all hospitals in the U.S. to disclose their standard charges since January 2021 to increase consumer choice and address inefficient pricing practices.

The rule requires hospitals to disclose their standard charges, which include the gross charges hospitals set for each item of care, as well as charges determined through negotiations between hospitals and third-party payers, such as health insurance providers, charges applied to individuals, and discounts for cash payments.

In addition, hospitals are required to disclose standard charges for each healthcare service they provide at least once a year in electronic form.

Since the rule was introduced, the percentage of hospitals disclosing their standard charges has increased significantly.

According to the U.S. Centers for Medicare and Medicaid (CMS), the percentage of hospitals that disclosed standard charges increased from 27 percent before the rule to 70 percent after the rule. However, 30 percent of hospitals still do not disclose their standard charges.

In response, CMS plans to increase the penalties for hospitals that fail to disclose their standardized charges to make the rule more effective.

Specifically, since last year, CMS has increased civil penalties for hospitals with more than 30 beds to include fines of up to $10 per bed, $5,500 per day, and $2 million per year.

In addition, the U.S. government plans to build a consolidated database of hospital charges for consumers using publicly available standardized hospital charge data, considering it is difficult for consumers to make comparisons across a wide range of publicly available data.