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CMS Finalizes Price Transparency Requirements

The Centers for Medicare & Medicaid Services (CMS) published new requirements for hospitals to publicly post standard charges, including information based on rates negotiated with third-party payers.

In a statement, America’s Essential Hospitals voiced concern about the posting of negotiated rates, which offers little benefit to the consumer, adds substantial burden to hospitals, and poses harm to competition.

In response to a June executive order on price and quality transparency, CMS set forth policies in the calendar year 2020 Outpatient Prospective Payment System proposed rule that build on hospitals’ existing requirements on the posting of standard charges.

Finalized price transparency provisions include:

  • definitions of “hospital,” “standard charges,” and “items and services;”
  • requirements for making public a machine-readable file online that includes all standard charges for all hospital items and services;
  • requirements for making public discounted cash prices, payer-specific negotiated charges, and de-identified minimum and maximum negotiated charges for “shoppable” services, all to be displayed and packaged in a consumer-friendly manner; and
  • actions to monitor compliance and address hospital noncompliance.

In finalizing this rule, CMS delayed implementation of these new policies by one calendar year, making a Jan. 1, 2021, effective date.

CMS will host a call about the hospital price transparency final rule on Dec. 3 from 1:30 to 3 pm ET.

New Transparency in Coverage Proposed Rule

Simultaneously, the departments of Health and Human Services, Labor, and Treasury issued a proposed rule that would require most insurance plans to disclose price and cost-sharing information to plan participants, beneficiaries, and enrollees.

The proposal would require plans to provide personalized access to cost-sharing information, including cost-sharing liabilities, for all covered health care services in real time. This content would need to be posted through an online tool and in paper format at the consumer’s request.

In addition, the proposal calls for plans and issuers to disclose on a public website their negotiated rates for in-network providers and allowed amounts paid for out-of-network providers.

Additional proposals would allow issuers to receive credit in their medical loss ratio calculations for savings they share with enrollees that result from the enrollee shopping for and receiving care from lower-cost, high-value providers.

Contact Senior Director of Policy Erin O’Malley at eomalley@essentialhospitals.org or 202.585.0127 with questions.

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About the Author

Erin O' Malley is the senior director of policy at America's Essential Hospitals.

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