Everything you should know about Price Transparency, Quickly
Price transparency was officially introduced into the healthcare industry in 2021 when a series of rules and regulations were enacted. Affecting hospitals and payers, The Centers for Medicare & Medicaid Services (CMS) and the U.S. Department of Health and Human Services (HHS) now mandates these entities to publicly disclose their cash, gross, list, and negotiated rates in machine-readable files (MRF).
Price Transparency Blew Up Healthcare
As you can imagine, this shook up the healthcare industry. Before 2021, there was no publicly available data showing the cost for any item or service. With price transparency data, sometimes called “rates data,” we have an unprecedented availability of rates with which to explore, use, and innovate. This data has many applications and third-party groups (like us!) are working hard to make it available and meaningful to anyone who wants it. The average patient probably isn’t aware of these rules and regulations, but hopefully, over time, that changes. We anticipate that the industry’s compliance will result in a lower cost of care and more-informed patients.
The Big Three of Price Transparency Legislation
There are three pieces of legislation that mandate price transparency compliance for varying entities:
The Hospital Price Transparency Rule: Effective as of 1/1/2021, this rule mandates hospitals publish standard charges via a machine-readable file (MRF) and prices for 300 Shoppable Services within a publicly-accessible Patient Estimate Tool.
Transparency in Coverage (TiC): Effective 7/1/2022, this final mandates payers publish standard charges via three separate machine-readable files (MRF) and prices for 500 Shoppable Services within a publicly-accessible Patient Estimate Tool.
The No Surprises Act (NSA): The only federal law influencing price transparency. Effective January 1, 2022, NSA prohibits balanced billing and introduces additional transparency requirements to help consumers know what costs to expect.
Two Common Terms
Price transparency data: This is a catch-all phrase for healthcare price transparency data collected directly from CMS-mandated machine-readable files (MRFs) published by hospitals or payers that display list, cash, and/or negotiated rates.
Revenue cycle: The administrative and clinical functions within healthcare that work to capture, manage, record, and collect patient service revenue.