On February 25, 2025, U.S. President Donald Trump signed an executive order aimed at enhancing healthcare price transparency, requiring hospitals and insurance companies to provide patients with clearer, more accurate, and actionable pricing information. This order builds on the Executive Order 13877, signed on June 24, 2019, titled “Improving Price and Quality Transparency in American Healthcare to Put Patients First”, which sought to increase regulation of healthcare providers and insurance plans to ensure the availability of price information.
Background of the Executive Order
During his first term, the Trump administration introduced several healthcare price transparency measures, mandating that hospitals and health plans disclose pricing information, including prices for up to 300 shoppable services and negotiated rates for all services provided. Health insurance companies were also required to make public their negotiated rates with providers, out-of-network payments, and the actual prices they or Pharmacy Benefit Managers (PBMs) paid for prescription drugs.
According to a 2023 economic analysis, if fully implemented, these regulations could save up to $80 billion for consumers, employers, and insurers by 2025. Another report from 2024 suggested that healthcare price transparency could reduce costs by 27% for employers across 500 common healthcare services. Data also showed that after the initial implementation of price transparency during his first term, prices for the top 25% most expensive healthcare services dropped by an average of 6.3% annually.
Key Provisions of the Executive Order
In his new executive order, President Trump noted that progress on price transparency has stalled at the federal level since the end of his first term. Hospitals and health plans have not been sufficiently held accountable for incomplete or missing price data. Additionally, the Biden administration has been criticized for not enforcing regulations that would make prescription drug prices fully transparent.
The executive order emphasizes that the U.S. government will take the following actions to further advance price transparency:
- Increase enforcement of existing price transparency requirements;
- Standardize pricing data to make it more easily comparable across hospitals and insurance plans;
- Require the disclosure of actual prices for services, not estimates;
- Issue updated guidance and proposed regulatory actions to ensure complete and accurate price reporting.
The Secretary of the Treasury, Secretary of Labor, and Secretary of Health and Human Services are required to take action within 90 days of the order to ensure the implementation and enforcement of these healthcare price transparency regulations.
Market and Policy Implications
The executive order has drawn attention from the healthcare industry and policy experts. According to the Centers for Disease Control and Prevention (CDC), healthcare spending in the U.S. accounts for nearly 18% of GDP, and rising costs have been a long-standing concern.
Market analysts suggest that further price transparency could impact hospitals, insurance companies, pharmaceutical companies, and PBMs, potentially leading to more price-conscious decision-making by consumers. The full impact of these measures, as well as the government’s ability to enforce them, will be closely watched in the coming months.
