5 tips to prepare for price transparency

Beginning in January 2021, hospitals will be under new federal price transparency rules, requiring them to post their "standard charges" online in a machine-readable file, including gross charges and payer-specific negotiated charges. They will also be required to post payer-specific negotiated rates online in a searchable and consumer-friendly manner for 300 "shoppable" services.

To help hospitals get ahead of these looming federal requirements, Kyle Sherseth, vice president of advisory services at nThrive, provided five price transparency preparation tips during an Oct. 9 session sponsored by nThrive at the Becker's Healthcare HIT + RCM Virtual Event.

The tips:

1. Identify risk areas and opportunities to improve chargemaster structure. Mr. Sherseth recommends having good policies to identify where the organization may have risk areas prone to regulation and scrutiny by payers, including emergency department reimbursement. He said good policies are important so the hospital can defend its charges and chargemaster structure. If "you don't have that in a written policy that you can back it up," said Mr. Sherseth, then "now's a good time to start thinking about, 'Where am I missing policies in my organization, and what do I need to do to get those in place?'" 

2. Ensure the chargemaster facilitates accurate, compliant billing. Ensuring the chargemaster facilitates accurate and compliant billing is even more crucial now with new price transparency regulations on the horizon, according to Mr. Sherseth. Therefore, he recommends hospitals conduct a chart audit to identify charge capture issues or billing issues or coding issues. He noted: "Now is the time to really think about that and to clean up the chargemaster before you put it out there on your website."

3. Ensure optimal market price positioning. Mr. Sherseth said strategic pricing is important and recommended hospitals focus on ensuring shoppable services are as low as possible for patients and that patients' out-of-pocket costs will be reasonable within the hospital's market. Even with price transparency, he said hospitals should still look at gross charges and how they compare within the hospital's market. "Are you in that 50th percentile with your market? Are your charges high? Are they low? Now's a good time to start thinking about where you do stand and making some adjustments for the future so that you are more in line with that market pricing," Mr. Sherseth said.

4. Update machine-readable chargemaster with all standard charge data. Hospitals should create an updated machine-readable website chargemaster that combines standard charge data and includes reimbursement information from the hospital's contract management system, or from contract papers, according to Mr. Sherseth. He recommends doing so immediately to be ready for the January price transparency implementation and go-live date.

5. Look at the shoppable services component of price transparency. Mr. Sherseth advises hospitals to create a "consumer-friendly" shoppable services file or deploy an online estimation technology to provide patients with a true out-of-pocket cost estimate. "These are the steps that you really need to think about from beginning to end to have a fully compliant chargemaster," he said.

To view the session on-demand, click here. To learn more about nThrive, click here.

 

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