Centers for Medicare & Medicaid Services, DAB CR6771 (2025)

DECISION

Respondent, Fulton County Hospital, is a hospital, located in Salem, Arkansas, that is subject to federal price transparency rules.  The Centers for Medicare & Medicaid Services (CMS) determined that the hospital violated those rules, and in response, CMS imposed a remedy:  a civil money penalty (CMP) of $300 per day for 213 days of noncompliance.

Respondent has appealed.  CMS asks for a decision based on the written record, and Respondent has not objected.

For the reasons discussed below, I find that a basis exists to assess a CMP against the hospital and that the amount of the assessed CMP is reasonable.

Background.

Section 2718(e) of the Public Health Service Act, referred to as the Hospital Price Transparency Act, requires that each hospital operating within the United States establish, update annually, and make public:  lists of the hospital’s standard charges for

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the items and services it provides.  42 U.S.C. § 300gg-18.  The statute’s implementing regulations are found at 45 C.F.R. § 180 et seq.

In this case, CMS determined that the hospital violated the statute and regulations because it did not make public a machine-readable file containing a list of all standard charges nor a consumer-friendly list of standard charges.  Notwithstanding CMS’s repeated attempts to encourage its compliance, the hospital did not do so.  In notices, dated December 21, 2022, and April 18, 2023, CMS advised the hospital of its determination and directed it to submit a Corrective Action Plan (CAP).  CMS Exs. 3, 7.

The hospital did not submit a CAP.  CMS Ex. 10.

In a notice dated July 20, 2023, CMS advised the hospital that it was imposing a CMP of $300 per day for 213 days (December 20, 2022 through July 20, 2023) (total:  $63,900).  CMS Ex. 11.  Respondent timely appealed.  CMS has no witnesses.  Respondent submits written declarations from four witnesses, but CMS has not asked to cross-examine any of them.  An in-person hearing would therefore serve no purpose, and this matter may be decided based on the written record.  See Acknowledgment and Pre-Hearing Order at 5-6 ¶¶ 9, 10) (June 4, 2025).  45 C.F.R. § 150.419(b).1

CMS has submitted a pre-hearing brief and request for judgment on the record (CMS Br.) with 12 exhibits (CMS Exs. 1-12).  Respondent has filed a pre-hearing brief (R. Br.) with 11 exhibits (R. Exs. A-K),2 and a request to supplement with a supplemental brief (R. Supp.).  CMS responded with an Opposition to the Request to Supplement (CMS Opp.).

In the absence of any objections, I admit into evidence CMS Exs. 1-12 and R. Exs. A-K.

Issues

The issues before me are:

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• Is there a basis for assessing a CMP against the respondent; and
• Is the amount of the CMP reasonable?  

45 C.F.R. § 150.417.  Respondent has added some additional issues:  whether it submitted the CAP, as requested; and whether CMS followed the steps in the regulations for assessing a CMP.  To the extent that I must resolve these questions in order to decide the two issues before me (whether CMS had a basis for imposing the CMP and whether the CMP is reasonable), I will consider them.

Discussion

1. CMS may impose a CMP against Respondent, Fulton County Hospital, because the hospital did not comply with the requirements of the Hospital Price Transparency Act; it did not make public a machine-readable file containing a list of all standard charges, and it did not make available a consumer-friendly list of shoppable services.3

The Hospital Price Transparency Act.  Under the provisions of the Hospital Price Transparency Act, each hospital operating within the United States must “establish (and update) and make public (in accordance with guidelines developed by the Secretary) a list of the hospital’s standard charges for items and services provided by the hospital, including for diagnosis-related groups established under section” 1886(d)(4) of the Social Security Act (42 U.S.C. § 1395ww(d)(4)).  Public Health Service Act § 2718(e) (42 U.S.C. § 300gg-18(e)) (emphasis added).

In keeping with the statute’s explicit directive, the Secretary of Health and Human Services has promulgated regulations requiring each hospital to make public:  1) a machine-readable file containing a list of “standard charges” for listed items and services; and 2) a consumer-friendly list of standard charges for a limited set of “shoppable services.”  45 C.F.R. §§ 180.40, 180.50, 180.60.  The regulation defines the terms “standard charge” and “shoppable service” as: 

• A “standard charge” is the regular rate established by the hospital for an item or service provided to a specific group of paying patients.  This includes:  gross charge, payer-specific negotiated charge, de-identified minimum negotiated charge, de-identified maximum negotiated charge, and discounted cash price.

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• A “shoppable service” is a service that can be scheduled by a healthcare consumer in advance.

45 C.F.R. § 180.20.

CMS evaluates whether a hospital has complied with the transparency requirements.  If CMS concludes that it has not, it acts to address the noncompliance.  Among the actions available, CMS may:  1) provide a written warning notice; 2) request a CAP; and 3) impose a CMP.  45 C.F.R. § 180.70(b).

In this case, CMS determined that the respondent hospital did not make public a machine-readable file containing a list of all standard charges for all items and services, as required by sections 180.40(a) and 180.50(a); and that it did not make available a consumer-friendly list of standard charges, as required by section 180.40(b).  CMS Exs. 1, 2.  In a notice letter, dated December 21, 2022, CMS advised the hospital of its determination.  CMS Ex. 3.

On April 14, 2023, CMS again reviewed the hospital’s website and again determined that the hospital did not comply with the pricing transparency requirements; it had not made public a machine-readable file or a consumer-friendly list of standard charges.  CMS Exs. 5, 6.  In a second notice letter, dated April 18, 2023, CMS advised the hospital that it “remained noncompliant with the requirements.”  The notice reiterated the violations:  1) it had not made public a machine-readable file containing a list of all standard charges for all items and services, which is required by sections 180.40(a) and 180.50(a); and 2) it had not made available a consumer-friendly list of standard charges for a limited set of shoppable services, which is required by section 180.40(b).  CMS Ex. 7 at 3-4.

CMS directed the hospital to submit a CAP within 45 calendar days of the date of the notice.  CMS Ex. 7 at 4.  The hospital did not subsequently submit a CAP.

On June 13, 2023, CMS again reviewed the hospital’s website and again determined that the hospital had not made public a machine-readable file containing a list of all standard charges for all items and services and had not made available a consumer-friendly list of standard charges for a limited set of shoppable services.  CMS Exs. 8, 9.

In an e-mail dated June 16, 2023, a member of the CMS compliance team reminded the hospital that the deadline for submitting its CAP (June 2, 2023) had passed.  The e-mail warned that if CMS did not receive the CAP by close of business June 19, 2023, CMS would “proceed with additional compliance actions.”  CMS Ex. 10 at 2.  In reply, a hospital representative referred to her February 24, 2023 e-mail, but, as CMS pointed out, that e-mail did not respond to CMS’s request for a CAP.  The hospital sent it almost two months before CMS requested a CAP.  CMS Ex. 10 at 1.

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In a notice letter, dated July 20, 2023, CMS noted that the hospital remained noncompliant with the price transparency requirements and had been noncompliant since December 20, 2022.  CMS advised the hospital that it was imposing a CMP of $300 per day for 213 days of noncompliance (December 20, 2022, through July 20, 2023) (total:  $63,900).  CMS Ex. 11.

The hospital concedes that it did not comply with the price transparency requirements but explains that it was not able to do so because of its dire financial situation and because the hospital’s senior management lacked the necessary time and expertise.  It points out that, since August 1, 2023, it has, at considerable expense, brought itself into compliance.  R. Br. at 4; CMS Ex. 12 at 8 (hospital response to CMS’s Request for Admissions).

Notwithstanding its concession, the hospital challenges CMS’s authority to impose a CMP for price transparency violations.  First, it argues that the statute does not allow CMS to impose the penalty because the statute’s penalty provision is in the section of the statute regarding insurance premium payments (section 2718(b)(3)) and not in the price transparency section (2718(e)).  R. Br. at 7.  Even if I found any merit to the hospital’s argument (and I do not), the regulations explicitly allow CMS to impose a CMP when it determines that a hospital violated the price transparency rules.  45 C.F.R. § 180.70(b)(3).  I do not have the authority to “find invalid or refuse to follow” the regulations.  45 C.F.R. § 150.403(c); see Donna Rogers, DAB No. 2381 at 6 (2011); 1866ICPayday.com, L.L.C., DAB No. 2289 at 14 (2009).

If I had the authority to consider the respondent hospital’s argument, I would reject it for the reasons cited by the Federal District Court for the District of Columbia in Amer. Hosp. Ass’n. v. Azar.  The court there acknowledged that the statutory language authorizing the Secretary to impose penalties “may have an awkward placement” in the statute but concluded that its plain language allows the Secretary “to impose penalties to enforce the entire section,” which includes section 2718(e).  Amer. Hosp. Ass’n. v. Azar, 468 F. Supp. 3d 372, 388-389 (D.D.C. 2020), aff’d, 983 F.3d 528 (D.C. Cir. 2020).

The respondent hospital also argues that CMS could not impose the CMP because the hospital representative submitted a CAP.  CMS may impose a CMP on a noncompliant hospital – as Respondent admittedly was – that fails to respond to CMS’s request to submit a CAP or comply with the requirements of a CAP.  45 C.F.R. § 180.90(a).  The hospital claims that e-mails sent by its representative constituted the hospital’s CAP.  R. Br. at 6.  In fact, the hospital’s e-mails did not respond to CMS’s request that it submit a CAP.  CMS Ex. 4 at 2-3; R. Ex. C at 1-2.  Nor were they submitted “in the form and manner, and by the deadline specified in the notice of violation” as required by section 180.80(c)(1).  In its April 18, 2023 notice letter, CMS listed the “Actions Your Hospital Must Take,” directing it to submit a CAP within 45 days of the date of the notice.  CMS Ex. 7 at 4.  At a minimum, the CAP had to include the following elements for each identified violation:

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• the corrective actions or processes the hospital will take to address the identified deficiencies;
• the timeframe by which the hospital would complete the corrective action; and
• the name of a contact person responsible for the CAP.

The CAP had to be signed by the hospital’s Chief Executive Officer/President and submitted, via e-mail, to a specified address, and had to be identified by the following subject line:  “Fulton County Hospital – Hospital Price Transparency CAP – 22262021.”  CMS Ex. 7 at 4.  The person who sent the e-mails was neither the hospital’s Chief Executive Officer nor its President.

Thus, CMS specified the “form and manner” for submitting the CAP.  The e-mails Respondent refers to did not meet any of these criteria.  They were not sent to the appropriate address; they were not captioned properly; and they were not signed by the hospital’s Chief Executive Officer or its President.  CMS Ex. 4; R. Ex. C.

Although the e-mails mentioned some actions that the hospital took to address its deficiencies (contracting with a marketing firm), they also acknowledged that those actions hadn’t corrected the problems (the contract did not include building the price transparency tool or shoppable services).  CMS Ex. 4 at 2-3; R. Ex. C at 1.  The e-mails did not suggest a timeframe by which the hospital would complete its corrective action.  Id.

Thus, the hospital did not meet the requirements of the Hospital Price Transparency Act, and, although CMS directed it to submit a CAP, it did not do so.  CMS was therefore authorized to assess a CMP against it.

2. The amount of the CMP – $300 per day – is reasonable. 

In determining whether the amount of the CMP is reasonable, I am not free to make a wholly independent determination, without regard for CMS’s discretion.  45 C.F.R. § 150.417(a); see 45 C.F.R. § 180.100(a); Barn Hill Care Ctr., DAB No. 1848 at 21 (2002); Springhill Senior Residence, DAB No. 2513 at 21 (2013) (finding, in a similar context, that the facility must show that the CMP is unreasonable under the regulatory criteria); Oaks of Mid City Nursing & Rehab. Ctr., DAB No. 2375 at 26-27 (2011).  I do not independently set the amount of the CMP; I simply determine whether the amount set by CMS is reasonable.

Here, the respondent hospital was licensed for 25 beds.  CMS Ex. 12 at 9.  Beginning January 1, 2022, hospitals with thirty or fewer beds were subject to a maximum CMP of

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$300 per day, even if the hospital violated multiple discrete requirements.  45 C.F.R. § 180.90(c)(2)(ii)(A).

The respondent hospital complains that CMS imposed the penalty without considering mitigating factors:  the hospital’s financial distress, lack of resources, and “attempts to engage with the CMS Price Transparency Compliance team” to develop a CAP.  R. Br. at 8.  However, in deciding whether the amount of the CMP is reasonable, I may consider only the following: 

• The hospital’s postings of its standard charges, if available.
• Material the hospital timely previously submitted to CMS (including “with respect to corrective actions” and CAPs).
• Material CMS used to monitor and assess the hospital’s compliance according to section 180.70(a)(2).  The section 180.70(a)(2) material includes:  i) CMS’s evaluation of complaints from individuals or entities; ii) CMS’s review of individuals’ or entities’ analysis of noncompliance; iii) CMS audit and comprehensive review; iv) requiring submission of certification by an authorized hospital official as to the accuracy and completeness of the standard charge information in the machine-readable file; v) requiring submission of additional documentation as may be necessary to determine hospital compliance.

45 C.F.R. § 180.100(b)(4).

These criteria seem to anticipate that the hospital will have achieved some level of compliance in posting the required pricing information.  But here, the hospital, by its own admission, posted no standard charges.  That, by itself, should justify an increase in the amount of the CMP.  In response to CMS’s December 21, 2022 notice letter, it offered excuses – staff didn’t understand that its contract with the marketing firm did not include building a price transparency tool or shoppable services and, without assistance, the hospital could not afford the cost of hiring someone else.  CMS Ex. 4.  When, four months later, CMS directed it to submit a CAP within 45 days, it failed to do so and has simultaneously:  1) claimed that it submitted a CAP as part of its initial response to the December letter and 2) complained that CMS did not help it to develop a CAP.

When the hospital missed its June 2, 2023 deadline, CMS gave it a final opportunity to submit a CAP (no later than June 19, 2023).  CMS Ex. 10.  It again failed to do so.  CMS thus gave the hospital six months in which to comply with the price transparency rules or to submit a plan explaining how it would comply.  It did not comply nor submit a CAP.

And these extensions of deadlines granted to the respondent hospital were in addition to the one-year extension CMS granted to all hospitals, from January 2020 to January 1,

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2021.  Recognizing that some hospitals “may find it challenging” to comply with the requirements of 45 C.F.R. Part 180, CMS extended the effective date of the policies for one year.

We believe this duration of delay balances the concerns between providing additional time for hospitals to implement the new requirements while still ensuring that hospitals’ standard charges are made public quickly to provide consumers access to this important information.  We decline to create a different effective date for a subset of hospitals, such as rural hospitals, to delay price transparency requirements as we believe the hospital price transparency requirements we finalize here are important to informing all consumers’ healthcare decision-making.

84 Fed. Reg. 65,524, 65,585 (Nov. 27, 2019).  And almost two additional years elapsed before CMS even began the process of bringing this respondent hospital into compliance (in late December 2021).

Based on these factors, I find that the $300 per day CMP is reasonable.

3. I am bound by the statute and regulations and have no authority to review the respondent hospital’s constitutional challenges.

In a supplement to its pre-hearing brief, the respondent hospital points to two fairly recent Supreme Court cases – SEC v. Jarkesy, 603 U.S. 109 (2024) and Loper Bright Enters. v. Raimondo, 603 U.S. 369 (2024).  Respondent asserts that, based on Jarkesy, I have no authority to hear this appeal; the Seventh Amendment to the Constitution mandates that the respondent hospital is entitled to a trial by jury.  Respondent also claims that, based on Loper Bright, CMS’s regulations exceeded the agency’s statutory authority to require that hospitals publish lists of standard charges for items and services provided.  R. Supp.

CMS responds that an administrative law judge is bound by the statute and regulations and has no authority to invalidate those provisions based on Constitutional challenges. This is correct and effectively ends my inquiry.  45 C.F.R. § 150.403; see Ilya Kogan, DAB 3034 at 6 (2021); Funmilola Mary Taiwo, DAB No. 2995 at 9-10 (2020); Donna Rogers, DAB No. 2381 at 5; Susan Malady, R.N., DAB No. 1816 at 4 (2002).

But, even if I could consider the issue, I doubt that either of these cases applies to CMPs imposed under the price transparency statute.  Jarkesy applies only if the CMP imposed is punitive, rather than remedial.  Review of the statute and regulations shows that their purpose is to induce hospitals to publish the required price transparency information.  CMS’s actions underscore its commitment to that purpose.  It delayed imposing CMPs at

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all to give hospitals ample time to comply, emphasizing that hospitals would “have the opportunity to take corrective action prior to the imposition of a remedy.”  84 Fed. Reg. 65,524, 65,587 (Nov. 27, 2019).  CMS explicitly set a CMP amount that was “reasonable and sufficient to ensure hospitals’ compliance with the proposed requirements to make public standard charges.”  Id. (emphasis added).

Nor do I agree that Loper Bright invalidates regulations drafted in response to an express delegation from Congress.  That decision recognized that “when a particular statute delegates authority to an agency consistent with constitutional limits, courts must respect the delegation, while ensuring the agency acts within it.”  603 U.S. at 413.  See Figueroa v. Sec’y of HHS, 2025 WL 2337297 at 4-5 (M.D. Fla. 2025) and cases cited therein.

But these are issues for another tribunal.

Conclusion

CMS had a basis for imposing a CMP against Respondent, Fulton County Hospital, because the hospital did not comply with the requirements of the Hospital Price Transparency Act; it did not make public a machine-readable file containing a list of all standard charges, and it did not make available a consumer-friendly list of shoppable services.  The amount of the CMP imposed – $300 per day – is reasonable.