Kennedy Updates Public On Price Transparency Rules To Reduce Healthcare Expenses For Americans
Updated
US HHS Secretary Robert F. Kennedy Jr. provided an update on the administration’s move to make health care prices transparent. A proposed rule has been published in the Federal Register by the Center for Medicaid and Medicare Services (CMS) under the guidance of Director Mehmet Oz and under the directive of President Trump’s executive order signed in January.
“Our proposed rule requires the information be provided to you in multiple ways including on your cell phone,” Secretary Kennedy said. “Other nations have found that when governments require price transparency, patients make informed choices that are better for them, better for society, bringing down national health care costs dramatically. Analysts estimate that price transparency could save American consumers $80 billion annually in healthcare costs. President Trump and I are doing everything we can to make sure that health care is more affordable, and that starts by empowering you with options and information right down to the last dollar.”
The proposed rule was published on December 23, and the public comment period is set to conclude on February 23, 2026. Once the comment period concludes, the agency must consider all comments received and determine whether any changes should be made. The rule applies to health insurance companies, so consumers can know the cost of different services before scheduling appointments.
Under the first Trump administration, a transparency rule was published requiring providers to share this information; however, the rule fell short of fulfilling the intended goals, according to a recently published CMS fact sheet. Since the rule was fully implemented in 2022, there have been three main barriers. The first is inaccessibility due to the large size of the machine-readable files. The second is data ambiguity due to a lack of contextual information alongside the raw data. The third is that there is some misalignment with the Hospital Price Transparency rule that makes comparing data across disclosures challenging.
The healthcare transparency rule is intended to improve the consumer experience and lower prices through competition. The Kaiser Family Foundation (KFF) and Peterson Center found that the US spends nearly twice as much per person on annual healthcare expenditures as the average across peer nations. The report notes that utilization of services, including doctor’s visits, the number and length of hospital stays, a variety of inpatient surgeries, and other healthcare services, is lower in the US than in peer nations.
Furthermore, the KFF and Peterson Center report says the Medicare data on fees excludes physician fees, which account for 5-10% of inpatient services and 10-50% of outpatient services. The authors note that the actual gap between US healthcare costs and those of peer nations may be wider, as this information is not included in the data.
The data show that the average annual healthcare expenditure per individual in the United States is $13,432, while the average across all peer nations is $7,393. Switzerland is the second-highest at $9,688, while Japan has the lowest cost per individual at $5,640. The United Kingdom spends $6,024 per person annually, and Canada spends $7,013.
Higher spending in the US is not due to higher service utilization, and the country also has a lower life expectancy than its peers. The HighWire has reported about this in the context of the childhood vaccine schedule, in which the US has recommended far more vaccines than peer nations, but has higher infant mortality and lower life expectancy.
The US also has higher obesity rates than peer nations, with 40% of adults compared to 20-30% in most OECD peer nations. A journal article examining the cost of obesity on the US healthcare system estimated that the total annual cost of healthcare related to obesity is $260 billion, which represents nearly 8% of the total annual expenditures of $4.9 trillion.
The administration has also enacted other measures to help reduce the cost of healthcare for American consumers, including a rule that was finalized in November that changes how Medicare pays hospitals and surgery centers for outpatient care. Beginning this year, the changes will encourage more procedures to occur in lower-cost outpatient facilities, which will reduce the overall expense to the American consumer. The HHS press release states that they expect the provision will save Medicare beneficiaries $70 million in the form of reduced beneficiary coinsurance while the Hospital Outpatient Prospective Payment System (OPPS) is expected to save $290 million in 2026.
“We continue to advance Medicare payment reform by advancing policies that help prevent services from unnecessarily being performed in hospitals when they can be safely provided in less intensive settings, streamlining hospital billing systems, and ensuring patients receive transparent, accurate pricing information,” said Chris Klomp, CMS Deputy Administrator and Director of the Center for Medicare. “These comprehensive changes deliver greater predictability, accountability, and affordability in hospital care.”
“This final rule from CMS closes the loopholes hospitals exploit to hide real prices and advances President Trump’s demand for radical hospital price transparency,” said HHS Secretary Robert F. Kennedy, Jr. “We are also confronting addiction head-on by expanding access to non-opioid treatments and implementing common-sense payment policies that make care more affordable and accessible for seniors.”
