Limited utility of price transparency data for drugs

Abstract

Since 2021, hospitals have been required to report the prices of common, shoppable services, including drugs, as per the Hospital Price Transparency Rule. In this paper, we used Hospital Price Transparency data aggregated by Turquoise Health to investigate the usability of price transparency data to evaluate variation in reimbursement for provider-administered drugs. We extracted records for 30 procedure codes corresponding to provider-administered drugs reported by at least 1,000 National Provider Identifiers (NPIs) and evaluated variability in rates reported for each procedure code. Among 3,321,502 records extracted, 65% had missing NPI, reimbursement rate, or National Drug Code (NDC) information. The remaining 35% of entries reporting NDC information did not necessarily report negotiated rates in the quantity of the NDC. Instead, they contained a combination of prices expressed in at least 3 different quantities: the quantity in which the procedure code is expressed, the unit of the NDC, and the total quantity of drugs administered to the patient. Until providers follow standardized requirements for the reporting of the data, the Hospital Price Transparency data should be used with caution, as the inability to correctly identify the unit in which prices are expressed can lead to incorrect inferences about drug prices.

FIGURE 1

Overview of Claims Selection

FIGURE 2

Distribution of Payment Rates for NDC Number 57894-0030-01