CMS’ new guidance puts stop loss on center stage

Greetings MRF enthusiasts! We celebrated the summer solstice a little late this year thanks to CMS’ newly-published “Guidance on Encoding Outlier Contracting Clauses in a Hospital's Machine-Readable File.” Soon after, CMS followed the guidance with the CY2027 OPPS and ASC Proposed Rule, which included a call for public comments regarding best practices for standardizing MRF reporting on outlier payments, stop-loss provisions, rate tiers and carve outs. Throughout the years of CMS updates on hospital MRFs at large, stop loss remained notably underrepresented, so this represents a meaningful milestone on the journey of high-utility MRFs. We’ll break down the high points below.

Stop Loss: coming to an MRF near you

To date, there has never been a clear, consistent place to report outlier and stop-loss clauses in MRFs. As a result, they’ve been difficult to track at scale, in some cases, and largely absent from files, in other cases. Hospitals were flummoxed as to how to include their outlier clauses  within the required schemas, and their absence in the wider price transparency universe has made it difficult to estimate the comprehensive cost of care with total confidence. At Turquoise, our perspective has always been the most complete file = the highest practical utility. With this new guidance, we’re another step closer to the most complete file and by extension, the most complete picture of healthcare prices.

What the guidance recommends for displaying outliers

CMS is offering the clearest technical guidance on outliers/stop-loss to date through formatting instructions and worked examples. Providers have two paths depending on scope:

1. In the case of an item/service-specific outlier clause, providers should encode it (including the fixed-loss threshold) in the required "payer-specific negotiated charge: algorithm" data element.
2. In the case of contract-wide or multi-service clauses, providers should use the optional "general contract provisions" data element, noting which services it applies to.

Until now, providers who chose to include these provisions tended to utilize the Additional Notes fields to house them. CMS’ new guidance explicitly discourages this approach. If you’re a hospital MRF generation team and you’ve been including your outlier terms in these notes fields, look into moving them into one of the aforementioned paths.

Is this “guidance” a new requirement?

The age-old question. To answer it, let’s open the trusty source material, the Hospital Final Rule:

According to 45 CFR 180.50(a)(3)(iii), “Hospitals must attest MRFs are true, accurate, and complete.” Since the CY2026 OPPS Final Rule, algorithm-based charges have required disclosure of everything needed to derive the dollar amount. A negotiated rate with an undisclosed clause that supersedes it isn't complete. And the final rule states the necessity of completeness. So, is it required? Our read: this specific guidance is not yet a hard requirement, but CMS clearly includes stop loss and outlier language in the scope of what is a ‘complete file’. So, what’s a provider to do?

Take advantage of detailed guidance and lots of lead time: encode those terms now

We’ve long believed outlier and stop-loss terms belong in MRFs, and we've advocated directly to policymakers for exactly this kind of standardization! So, all in all, it’s a win for the industry to see these negotiated rates included and taken center stage in CMS’ immediate agenda. As with every new requirement or guidance, the work to encode this information consistently and accurately is no small feat. But that effort is directly proportional to the utility of a file and its material improvements to the data at large. If you’re a provider, stay tuned to the CMS GitHub and CMS Hospital Price Transparency resources page, as we anticipate additional guidance and the follow-up final rule in the coming months. 

Previously, hospitals had recommended schemas they could utilize. Another round of CMS’ policy history tells us today’s guidance is tomorrow’s proposed and final rules. Eventually, they’ll move those schema options from recommended to required. That’s our read on where this outlier reporting is headed. That means it probably behooves hospitals to start taking an inventory of outlier and stop-loss language across contracts and working to encode these terms per the guidance. 

We’ll be submitting a public comment before the August 31, 2026 deadline and anticipate hospitals and other organizations will do the same. More to come!

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