Compliance and Variability of Hospital Price Transparency in Total Knee and Hip Arthroplasty in the United States

Introduction: On January 1, 2019, in an effort to improve price transparency, the Centers for Medicare and Medicaid Services (CMS) mandated that hospitals display chargemasters and pricing for diagnosis-related groups (DRGs) online. We examined the compliance of the 50 top orthopaedic hospitals, ranked by US News, with CMS's mandate and compared pricing. Methods: The chargemaster and pricing of DRG codes related to total knee arthroplasty (TKA) and total hip arthroplasty (THA) (469, 470, 461, 462, 466, 467, and 468) were evaluated in the top 50 orthopaedic hospitals in the United States. Spearman rank correlation coefficients (rho) were used to evaluate the association between DRG 469, 470, and 467 prices with geographic practice cost index (GPCI) work and practice expense values. Results: Thirty-six of the 50 hospitals reported DRG pricing for THA and TKA. Of these hospitals, 15 had prices for all seven DRGs of interest; only 467, 469, and 470 were reported across all the 36 hospitals. Of the 14 hospitals without DRG information, 12 had nothing and two had unsatisfactory reporting. Prices for DRGs 469, 470, and 467 were moderately or weakly correlated with both GPCI work and GPCI practice expense. All correlation analyses were statistically significant (P < 0.05). Discussion: In summary, compliance with CMS's 2019 rule was poor overall. Fourteen of the 50 hospitals did not adequately report any DRG pricing, and only 15 of the hospitals were fully compliant with the mandate. In addition to poor compliance, the reported costs had variation not strongly accounted for by established geographic differences.