Understanding CMS Price Transparency

Consumers and patients now have visibility into the out-of-pocket cost of standard care from a provider. Insurance companies and healthcare systems will now disclose the estimated cost a patient will have to pay before receiving care. The end goal is to give the American people the information they need to make an informed decision about their healthcare purchases.  

Under this new ruling, hospitals will provide a list of standard prices of “shoppable services” and the lowest amount of cash they will accept from consumers paying out of pocket. While there has been significant pushback from the healthcare industry with valid concerns, the new rule has been put into place. In provider-payer negotiations, hospitals will publish the minimum, and maximum cash prices, including the lowest cash payment hospitals, will accept consumers. [1] 

With this final rule, insurance companies will also be required to disclose on a public website their in-network negotiated rates, billed charges, and allowed amounts paid for out-of-network providers, as well as the rates with the historical net price for prescription drugs. By making this information readily available to the public, we will see a rise in innovation, price-conscious decision-making, and a more competitive health care industry. [2] 

With price transparency in place, about 200 million Americans will possess access to real-time price information, allowing them to take control of their health care and evaluate the cost before going in for treatment. This rule requires group health plans and health insurance companies to provide easy-to-understand personalized information on enrollee cost-sharing for health services. However, they are also required to publicly disclose the rates to pay healthcare providers for specific services. This new ruling will allow healthcare costs to go down for employers, providers, and patients.  

While price transparency is still rolling out this year, we can expect new changes to this ruling over the next few years. By 2022 this rule will require plans to standardize and regularly update all data files publicly. Through this public data, new opportunities for research and innovation will arise within the healthcare market.  

As of January 1, 2023, the price transparency ruling will require health plans to offer a new online tool that will give consumers visibility into the negotiated rates between their provider and their plan. This tool will also provide their out-of-pocket cost for 500 of the most shoppable items and services. The following year, these tools will be required to show the costs for the remaining items such as procedures, drugs, durable medical equipment, and any other item or services needed by a patient. [3] 

During this change, providers must partner with vendors who understand this new ruling and what it means for the future of healthcare. iMedX is a trusted vendor among top hospitals and practices when partnering with an RCM Analytics, Coding, Transcription, and Virtual Scribe services partner. iMedX’s Price Transparency tool is easy to implement and fully compliant with the CMS final rule Contact us to learn more. A plan to adjust to the price transparency rule is critical to the success of healthcare organizations.  

  1. https://www.healthaffairs.org/do/10.1377/hblog20200304.157067/full/  
  2. https://www.cms.gov/newsroom/fact-sheets/transparency-coverage-final-rule-fact-sheet-cms-9915-f  
  3. https://www.cms.gov/newsroom/press-releases/cms-completes-historic-price-transparency-initiative