Poison Pill Quiets Hospitals on Defying Price Transparency Rule

Hospitals that threatened to defy the federal government’s requirement to disclose their negotiated prices with insurers by Jan. 1 are reconsidering after a harsh new penalty—possible loss of Medicare payments—was buried in a subsequent regulation.

Some had considered not complying, protesting that disclosing prices is costly and would put some of their business practices in jeopardy. The fine set out by the initial price transparency regulation was $300 a day, whereas major hospitals project their initial costs of complying at $500,000 a year, or more than $1,300 a day, according to the American Hospital Association.

However, a recent yearly payment ...