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Price Transparency Is Almost Here. Is Your Hospital Ready?

Price Transparency Is Almost Here  Is Your Hospital Ready Web

The new year is fast approaching, and with that comes the start of CMS’s price transparency rule. Effective January 1, 2021, all hospitals must publish a wide range of information regarding the prices they have negotiated with payers for items and services. While the goal is to help consumers compare prices across different providers, the requirements may impose a significant administrative burden on hospitals. Even if compliance by January 1 is not feasible, it is in hospitals’ best interest to begin preparation as soon as possible to avoid noncompliance penalties. Listen to ECG experts discuss pricing transparency in this webinar.

The rule requires that hospitals post two types of pricing information:

  • Comprehensive File of Standard Charges: A single, machine-readable file displaying negotiated rates for all items and services (including supplies, facility fees, and professional charges for physicians/APPs or other providers for both inpatient and outpatient services that appear in the charge master).
  • Shoppable Services: A consumer-friendly display of negotiated rates for at least 300 shoppable services. This includes plain-language descriptions of the services (along with associated ancillary services). CMS has identified 70 of these items and is leaving it up to the hospital to define the remaining 230.

Although the rule leaves many questions unanswered or open to interpretation, CMS is clear that this information must be free to the consumer, not require an account or login, and include all of the organization’s locations.

CMS is taking a light approach to monitoring and enforcement initially, but will likely get more aggressive in the future. For now, CMS plans to respond to complaints rather than actively monitor hospitals’ compliance. If a complaint is lodged and CMS determines the hospital to be noncompliant, it will seek a corrective action plan, post information regarding the hospital’s noncompliance on the CMS website, and may ultimately impose a fine of up to $300 per day during noncompliance. Therefore, even hospitals that are noncompliant on January 1 may be able to avoid negative consequences if they act swiftly.

Ready or Not…

Our experience is that most hospitals are unprepared, which is no surprise given the tumultuous year we’ve had in 2020. However, we see no indication that CMS plans to relax its requirements or push back the implementation date. Further, the effort involved in compliance can vary tremendously based on the capabilities of a hospital’s billing systems and associated technologies.

ECG is available to help clients meet the challenges.

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