Analysis of Hospital Chargemasters Shows Hospitals Have Room for Improvement in Usability

As part of its cost transparency initiative, the Centers for Medicare and Medicaid Services (”CMS”) issued a final rule  in 2018 requiring hospitals to publish price lists, referred to as “chargemasters,” for various inpatient and outpatient services and treatments they provide to patients. Recently, the consulting firm ADVI Health released an analysis of the chargemaster lists from the top 25 hospitals by total revenue. The report focuses on the cost transparency features and recommends best practices to improve transparency.

The analysis showed that improvements in the following chargemaster components would support CMS’ goal of increasing transparency:

Data Elements: The report recommends that chargemasters be comprehensive for all services provided in inpatient and outpatient settings and provide prices for each individual service and procedure. The documents should also clearly identify if a charge is for the administration of a service, or for a specific component of medical technology (e.g., a pacemaker or a hip implant). The document should identify several elements related to prescription drugs, including the drug’s Healthcare Common Procedure Coding System (“HCPCS”) code, as well as the dose of the drug. Finally, the wording and content of the document should limit technical medical terms, abbreviations and numbers, so that consumers can identify services and compare them across hospitals.

File Format: The document should be machine readable so that it can be easily imported into a computer system (e.g., .xml, .csv file types). In addition, hospitals could include a searchable list of charges, and create a search tool that auto populates suggested search terms as the user inputs data into the search field.

Location and Accessibility: The chargemaster should be posted in a logical location on the hospital’s website, such as the homepage or a billing page, so that it is accessible through a short number of clicks. In addition, the hosp04ital should not create barriers to access, such as requiring the user to provide their name, email address, or other personal information before getting access to the data.

Updates: The document should be updated regularly so that it reflects current charges, and it should include a date specifying when it was posted and/or updated.

Applicability: For hospital systems with multiple sites, the document should clearly identify if it applies to the full hospital system, or to an individual hospital within the system.

This CMS chargemaster reporting requirement is one of many components of the Trump Administration’s price transparency initiatives. However, it is clear from the ADVI Health report that there is a long way to go in getting hospital pricing information to consumers in a clear and usable format so that meaningful price comparison can happen.