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CMS proposed rule requires hospitals to make public their payer-specific negotiated charges

CMS Administrator Seema Verma says agency is not afraid of legal push-back from providers or payers.

Susan Morse, Senior Editor

The Centers for Medicare and Medicaid Services Administrator Seema Verma released Medicare payment rules changes on Monday, including a proposal for hospitals to post not only their chargemaster prices online, but their payer specific negotiated rates.

This would mean revealing what is negotiated in payer contracts.

Asked if CMS was concerned about push-back from providers and payers in a potential lawsuit, Verma said, "This administration is not afraid of those things. We're not about protecting the status quo when it doesn't work for patients."

CMS is proposing that hospitals make public their payer-specific negotiated charges for a limited set of 'shoppable' services, or face civil monetary penalties.

This is for at least 300 shoppable services, including 70 CMS-selected shoppable services and 230 hospital-selected shoppable services. If a hospital does not provide one or more of the 70 CMS selected shoppable services, the hospital must select additional shoppable services for the total number to be least 300.

The posting must include charges for services that the hospital customarily provides in conjunction with the primary service that is identified by a common billing code.

The information must be updated at least annually.

The deadline for submitting comments on the proposed rule is September 27. The rule would go into effect on January 1, 2020.

The price transparency requirements will increase competition among all hospitals by requiring them to make pricing information publicly available, CMS said.


Currently, CMS and beneficiaries often pay more for the same type of clinic visit in the hospital outpatient setting than in the physician office setting.
This has resulted in hospitals buying up physician practices, Verma said.

As finalized in last year's rule, CMS is completing the two-year phase-in of making more site neutral payments.

This proposed change would result in lower copayments for beneficiaries and savings for the Medicare program and taxpayers estimated to be a total of $810 million for 2020.


CMS is also updating the 2020 Ambulatory Surgical Center Payment System Proposed Rule and the 2020 Medicare Physician Fee Schedule and Quality Payment Program (QPP) Proposed Rule and the 2020 Medicare End Stage Renal Disease (ESRD) and Durable Medical Equipment Prosthetics, Orthotics, and Supplies (DMEPOS) Proposed Rule.


This proposed rule is the result of President Trump's recent Executive Order on price and quality transparency that lays the foundation for a patient-driven healthcare system, CMS said.

Twitter: @SusanJMorse
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