Imagine you’re facing knee surgery. You call around for quotes. Hospital A, in-network with your insurance, says your out-of-pocket will be about $2,500 after the deductible and coinsurance. Hospital B, also in-network, quotes $1,200 for the same procedure with the same doctor. Same city, same insurance plan, but a $1,300 difference just because of where it’s done. Or maybe one doctor’s office has a higher negotiated rate with your insurer, so even though it’s “covered,” you pay more coinsurance. This is the black box of American health care—prices vary wildly depending on the provider, the facility, and the payer. Patients can get blindsided, stuck with bills they never saw coming, all because no one told them upfront what they’d actually owe.
Five years ago, President Trump signed the Consolidated Appropriations Act, which included an important provision championed by the then Ranking Member of the Ways and Means Committee, Kevin Brady: the Advanced Explanation of Benefits (AEOB). This wasn’t just another line in a big bill but a meaningful step forward in empowering patients. It meant that when you schedule a non-emergency procedure or request an estimate, your provider sends a good faith estimate to your insurer. The insurer then has to send you an AEOB laying out exactly what your out-of-pocket costs will be—deductibles, copays, coinsurance, everything. Most people receive an explanation of benefits, but it is after they have already received services. With the AEOB there will be no more guessing and no more shocks on what a patient will be expected to pay. The idea that a consumer cannot get insight into how much they will have pay for a service is not a novel concept, as it is the standard convention in every other economic sector.
Trump signed it as part of his broader push for healthcare transparency—executive orders mandating hospitals post real prices online, rules forcing insurers to reveal negotiated rates. The Trump Administration was relentless in increasing health care price transparency and attempting to expose the hidden pricing that pads profits for hospitals and insurers while leaving patients in the dark. In a 2019 paper, Brian Blase outlined four principal outcomes from increased transparency:
- Better informed consumers and patients
- Better informed employers that help workers shop for value
- Improved ability for employers to monitor insurer effectiveness and eliminate counterproductive middlemen
- Public pressure on high-cost providers.
The AEOB was a key component of the Administration’s transparency effort: personalized, upfront information so you can actually shop, compare, and plan. The law set a start date in 2022. But the Biden administration missed that deadline, deferred enforcement citing tech challenges, and then let it gather dust for years with requests for information (RFIs), bureaucratic updates and broken promises. Meanwhile, the good faith estimate rolled out for uninsured patients, showing it was doable when prioritized. However, the good faith estimate primarily affects uninsured or self-pay patients, leaving insured Americans waiting, still hit with unpredictable bills.
Now, five years later, the Trump administration is back in charge and should finish the job. They’ve already issued executive orders ramping up enforcement of existing transparency rules—cracking down on hospitals and insurers hiding prices. Part of that effort should be implementing the upfront cost information patients were promised half a decade ago.
When you buy anything else—a phone, a vacation, or an automobile repair—you know the price before you commit. AEOBs would empower many patients, spark real competition, and drive costs down.
Five years ago, President Trump put this on the books, but for four years the Biden Administration drug its feet and kept this needed tool from patients. Patients have waited long enough for the transparency they were promised and now it looks like the excuses are over.
