Q&A from CMS Leaves Hospital Questions Unanswered

H&A CDM Transparency Series

CMS has provided more clarification on the requirements for hospitals with the charge transparency mandate effective 1/1/19. Since the release of our 9/4/18 article, we have presented to an HFMA chapter meeting, and participated in numerous calls with customers and business colleagues to hear what others are planning. State Hospital Association representatives have requested CMS conduct an Open Door Forum call on this topic.

 Based on what we hear and read, the industry has been buzzing with different interpretations and opinions. We’ve listed the CMS Q&A text as well as our team’s feedback in this article.

CMS FAQ Title: “Frequently Asked Questions Regarding Requirements for Hospitals To Make Public a List of Their Standard Charges via the Internet”

Q. What format is a hospital required to use to make public a list of their standard charges via the Internet?

A. The format is the hospital’s choice as long as the information represents the hospital’s current standard charges as reflected in its chargemaster.

Holliday & Associates Impression:

Clarification of CMS’ flexibility with the format of the published pricing is good news. Those planning to use the ChargeAssist® public access portal with be compliant, yet still protect their data.

There have been continued customer questions about CMS’ interpretation of ‘standard charges’. We believe this is clarified in the Final Rule discussion and noted in our article that follows. CMS has clarified that standard charges reflect your current (non-discounted) pricing listed in your charging masterfiles (CDM, EAP, etc.). This leaves questions for hospitals utilizing Cerner Community Works and other HIS platforms that report the Charge Master with multiple prices for one charge record. This has also raised concern with 340B drugs vs similar charge items. For reporting, additional entities or cost centers may be needed if you wish to display more than one price per charge item. However, CMS has not stated whether multiple prices must be included (ex. inpatient vs outpatient).

We’re advising hospitals to review and possibly streamline a display version of their Charge Master content. An easily-understood public view file will minimize confusion when the shopping public tries to research pricing.

Q. Do the requirements apply to all items and services provided by the hospital?

A. The current requirements apply to all items and services provided by the hospital.

Holliday & Associates Impression:

Definition of the display file content requires confirmation of entities, departments, and source files your team plans to publish. The applicable charge items can then be correlated to cost centers or other department indicators as you build a data extract for public view. Defining data today will ensure consistent and appropriate content within the publication versions that you’ll have available in January and in the future as updates are necessary.

On a related note on this topic, hospitals have asked up how they should address charges that a shopping patient wouldn’t understand. For example, there is no requirement that OR levels or timed charges be correlated to procedure pricing estimates. As we note in the September article, panel components with no price, statistical charges, and other non-charge data will only confuse the public. Additionally, patients may not understand that multiple items and services are likely components of the charge item they are researching..

From the more global standpoint, remember that CMS has not stated the “entire Charge Master file” has to be published.  See our article for other considerations on other data your team may (and may not) wish to include.

Q. Do the requirements restrict a hospital from posting quality information or additional price transparency information?

A. CMS encourages hospitals to undertake efforts to engage in consumer friendly communication of their charges to help patients understand what their potential financial liability might be for services they obtain at the hospital, and to enable patients to compare charges for similar services across hospitals. A hospital is not precluded from posting quality information or price transparency information in addition to its current standard charges in its chargemaster.

Holliday & Associates Impression:

Based on market feedback, the mechanics and the unknowns of the new CMS requirements appear to be hospitals’ primary concerns. On a secondary, yet equally important level, hospitals realize that succeeding under increased public attention will require attention to Charge Master data as well as pricing. Additional transparency tools will most likely be desired to help patients make healthcare shopping easier and more meaningful. Educating your shopping patients on our complex charging systems may become necessary.

A Charge Master and Pricing Transparency strategy will most likely require executive attention. Clearly, internal hospital information, third party products, consulting services, and transparency approaches will vary hospital to hospital over the coming years.

We are suggesting that our customers utilize the functions provided through ChargeAssist® as they develop their publication strategy.

Q. What is the definition of “machine-readable” for purposes of the requirements?

A. By definition, machine readable format is a digitally accessible document but more narrowly defined to include only formats that can be easily imported/read into a computer system (e.g., XML, CSV). A PDF, on the other hand, can be a digitally accessible document but cannot be easily imported/read into a computer system.

Holliday & Associates Impression:

We expect more specific data requirements will be announced in future years, but as of now, CMS has not mandated exact file content or data elements.

We’re concerned that hospitals may face competitive pressures or negative press with fully-transparent file downloads on their websites. In our view, using a portal to protect your data from undesired downloads is critical.


Q. What hospitals are required to make public a list of their standard charges via the Internet?

A. In the FY 2015 IPPS/LTCH proposed rule and final rule (79 FR 28169 and 79 FR 50146, respectively), CMS noted that section 2718(e) of the Public Health Service Act, which was enacted as part of the Affordable Care Act, requires that each hospital operating within the United States, for each year, 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. There are no hospitals operating within the United States with exemptions from this requirement under the current policy.

Holliday & Associates Impression:

Some non-prospective payment providers have asked if they were exempt from the publication requirements. CMS clearly states that all hospitals must comply.

Q. Does participation in a state online price transparency initiative satisfy the federal requirements?

A. CMS is fully supportive of and encourages state price transparency initiatives. However, under the current guidelines, participation in an online state price transparency initiative does not exempt a hospital from the requirements.

Holliday & Associates Impression:

This response clearly confirmed that State publication of your prices (ex. California, Florida, etc.) does not replace this CMS requirement. Again, whether for State or National purposes, the Charge Master data published must be accurate and appropriate in content. Because of the State publication timelines, your National CMS file may have differing prices. We do not advise hospitals to simply post the same file.

Source: https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/AcuteInpatientPPS/Downloads/FAQs-Req-Hospital-Public-List-Standard-Charges.pdf

To read more about Hospital Price Transparency, read through our other articles:
Price Transparency “Round 2”– CMS Seeks Input
The Chargemaster: What your Shopping Public Needs to Know
CDM Transparency – More speculation & More confusion
CDM Transparency 1Q19 Update
Q&A from CMS Leaves Hospital Questions Unanswered
IPPS CDM Public Access Announcement Causing Confusion & Concerns: Tips for Hospital Action Plans
June 24th Executive Order