Administration finalizes requirement for hospitals to post rates paid by health plans
The Trump administration requires hospitals to post online the rates they negotiate with health plans, as well as rates for 300 “shoppable services,” by 2021.
The Nov. 15 final rule from the Centers for Medicare & Medicaid Services (CMS), which prompted one hospital advocate to immediately promise to file a lawsuit, requires hospitals to post online all their standard charges (including gross charges, payer-specific negotiated charges, de-identified minimum and maximum negotiated charges and discounted cash prices) for all items and services in a single digital file and in a machine-readable format.
Hospitals also must post online their standard charges for at least 300 “shoppable services” (that is, 70 CMS-specified and 230 hospital-selected services) that the hospital provides. This information must be made available in a consumer‑friendly manner. The posted rates must include charges for services that the hospital customarily provides in conjunction with a primary service that is identified by a common billing code.
CMS will deem a hospital compliant with the new requirements if the hospital maintains an Internet-based price estimator tool that meets specified requirements, including real- time estimates for consumers on their costs for a shoppable service offered by the hospital.
Failure to comply with the requirements could lead CMS to impose fines of up $300 per day (totaling $109,500 annually) and to publicize a hospital’s lack of compliance on its website.
Details of price posting requirements:
- • Describe each item or service
- • Display prominently and clearly, and identify the hospital location
- • Ensure the data is easily accessible, without barriers, is free and does not require an account or password or a user to submit personal information
- • Update the data at least annually
Definition of standard charges
CMS is finalizing the definition of standard charges to include the following 5 elements.
Gross charge. The charge for an individual item or service that is reflected on a hospital’s chargemaster, absent any discounts
Discounted cash price. The charge that applies to an individual who pays cash, or cash equivalent, for a hospital item or service
Payer-specific negotiated charge. The charge that a hospital has negotiated with a third-party payer for an item or service
De-identified minimum negotiated charge. The lowest charge that a hospital has negotiated with all third-party payers for an item or service
De-identified maximum negotiated charge. The highest charge that a hospital has negotiated with all third-party payers for an item or service
Source: CMS, “CY 2020 Hospital Outpatient Prospective Payment System (OPPS) Policy Changes: Hospital Price Transparency Requirements (CMS-1717-F2),” Nov. 19, 2019.