Healthcare Revenue Cycle Management, ICD-10, Claims Reimbursement, Medicare, Medicaid

Policy & Regulation News

“Just the Beginning” of Healthcare Price Transparency, Verma Says

CMS Administrator Seema Verma explained that requiring hospitals to post prices online is just the start of an agency-wide effort to increase healthcare price transparency.

Healthcare price transparency and CMS

Source: Xtelligent Media

By Jacqueline LaPointe

- Requiring hospitals to post a list of their standard charges online is just the beginning of the push for increased healthcare price transparency by CMS, explained the federal agency’s Administrator Seema Verma.

“As people are paying more for their healthcare, they’re demanding more. They want quality and price transparency. This is just a response to the needs of patients,” she said in an exclusive interview with Jennifer Bresnick of HealthITAnalytics.com.

The new requirement mandates that hospitals make public a list of their current standard charges via the Internet by Jan. 1, 2019. Hospitals must also update the list at least annually.

Hospitals currently abide by healthcare price transparency requirements under the Affordable Care Act. The organizations must establish, update, and make public a list of the organization’s standard charges for items and services provided, including diagnosis-related groups. But the rule does not explain how hospitals should publish the information and it allows organizations to merely publish policies for allowing the public to access a list of standard charges upon request.

Under the Affordable Care Act’s requirements, CMS still observed patient challenges with healthcare price transparency.

In the proposed rule containing the new healthcare price transparency requirement, CMS specifically called out surprise billing practices in which a patient receives an unexpected bill for out-of-network physicians who provide services at in-network hospitals. Patients also continue to feel confused and surprised by facility and physician fees for emergency room visits.

Verma and her colleagues at the federal agency intend to alleviate patient concerns with financial responsibility by promoting better price transparency.

“When you go to receive a healthcare service, there are always going to be situations where you can’t know what the costs will be, especially around emergency situations and some acute situations,” she said. “But for a lot of us, we’re going in for planned procedures. You should be able to know what it’s going to cost you.”

The patient experience should mimic that of other industries when it comes to price transparency and the ability to compare services, she added.

“If you’re buying a car or pretty much anything else, you’re able to do some research,” she remarked. “You’re able to know what the quality is. You’re able to make comparisons. Why shouldn’t we be able to do that in healthcare? Every healthcare consumer wants that.”

The new healthcare price transparency requirement for hospitals is a step in the right direction, CMS explained. But the federal agency intends to do more after hearing from stakeholders.

CMS issued a Request for Information (RFI) in the recently proposed rule that called on stakeholders to provide additional information on healthcare price transparency and effective methods for improving transparency. The federal agency specifically asked stakeholders to answer:

• How should “standard charges” be defined (e.g., average or median rates for chargemaster items, average or median rates for groups of services commonly billed together as determined by the hospital, or average discount off the chargemaster amount across all payers)?

• What types of information would help patients understand hospital prices and patient financial responsibility? How should hospitals use this information to inform patients and decision-making?

• Should healthcare providers be required to tell patients about their out-of-pocket costs for a service prior to care delivery? Should providers even play a role in informing patients of out-of-pocket costs?

• Should CMS require providers to give patients information on what Medicare pays for a service?

• How should CMS enforce healthcare price transparency requirements? Should hospitals have to attest to meeting requirements?

In addition to general healthcare price transparency questions, CMS is also seeking comments on understanding the out-of-pocket costs for patients with Medigap coverage.

The RFI echoes a recent push for healthcare price transparency information from a bipartisan group of Senators. Senators Bill Cassidy, MD (R-LA), Michael Bennet (D-CO), Chuck Grassley (R-IW), Tom Carper (D-DE), Todd Young (R-IN), and Claire McCaskill (D-MO) reached out to industry groups in March 2018.

They asked the organizations to provide information on healthcare price transparency, such as what price information is currently available and unavailable to consumers, what is the cash price’s role, who should be responsible for providing price information to patients, and what regulatory barriers exist that make price transparency burdensome for providers.

The Senators anticipate the stakeholder comments to inform a healthcare price transparency initiative that has goals as those expressed by CMS Administrator Verma. The policymakers intend to help consumers price shop and compare healthcare services the way they already do for services in other industries.

With support from both Senators and CMS, increased healthcare price transparency is on the horizon. Additional requirements and initiatives from CMS are looming closer as the federal agency continues their efforts to empower patients and advance value-based care through more transparency.

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