Insights: Article

Pricing Transparency Advisory Deadline

By Amy Tepp

December 26, 2018

We understand many of you are working on being compliant with the IPPS FY 2019 Final Rule Pricing Transparency requirements. You have likely read the most recent additions to the CMS website for Pricing Transparency—specifically, the FAQs and AFAQs.

At this time, Eide Bailly can provide guidance based on what is available from the rule as well as the FAQs/AFAQs. We have received many inquiries, such as “are RHC charges to be published?” “What about Drugs and Supplies?” “How is this really helping the patient?”

Here’s what we can state based on what we have seen in the afore mentioned guidance as well as the most recent American Hospital Association (AHA) Advisory:

  • The CMS FAQs on pricing transparency, read literally, appear to state that ALL of your standard charges for the hospital need to be published.
  • Although this may not be easily understood by patients, the intent of the CMS is to move hospitals to be transparent with their pricing.
  • Hospitals are encouraged to provide educational guidance as part of their website posting.
  • All hospitals, regardless of how they are paid by Medicare, are required to post their standard charges.
  • Charges must be in a machine-readable format (i.e., no pdf documents.)
  • Charges must be updated at least annually.
  • Data must be on the hospital’s website by January 1, 2019, in order to be compliant with this rule.
  • CPT codes do not need to be published, but they can be if you are confident you have the correct licensing with the AMA to do so.
  • Currently, there are no known penalties for non-compliance, but we anticipate future rules will outline such penalties.
  • Subsection (d) hospitals (i.e., those paid under the IPPS), are required to make public a list of their standard charges for each diagnosis-related group established under section 1886(d)(4) of the Social Security Act.

We will continue to track pricing transparency and guidance from CMS as things develop.

The following are additional considerations that may help you in deciding if services must be posted as part of this requirement:

  • Is the service provided as part of the license of the hospital? If not, then it would not necessarily be required to be included in this posting. This would apply to RHCs, for example.
  • Professional services are not considered hospital services, and thus are not part of this posting requirement.

Eide Bailly is suggesting clients look towards using this guidance as an opportunity to put a more strategic spin on charging methodologies, chargemaster, pricing and transparency. Posting the charges is a good first step. We are recommending using this as the kick-off to asking questions regarding your charging strategy, such as “when was the last time we looked at our chargemaster and the surrounding policies and procedures?” “Are we actually capturing the charges we have in the chargemaster?” This is something that can be acted upon with a thoughtful plan and timeline.

Although there is still uncertainty, what we do know for certain is pricing transparency is here to stay. Organizations need to formulate a plan that goes beyond the posting of their standard charges if they want to stay on the right course.

If you have any additional questions regarding this, feel free to contact Amy Tepp, Partner, Director of Revenue Cycle Services.

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