Health Tech, SYN

Price Transparency Compliance Is a Very Different Story for Hospitals Vs. Payers

Payers and providers face different challenges when it comes to compliance. The volume of price transparency data that hospitals must disclose online amounts to about 3 terabytes — compared to the whopping 630 terabytes of data that payers have been tasked with posting.

When looking back at this year in terms of price transparency, one thing is very clear: payers and providers face different challenges when it comes to compliance.

That was one of the main takeaways from a year-end report released Thursday by price transparency software startup Turquoise Health. The report showed that the volume of price transparency data that hospitals must disclose amounts to about 3 terabytes — compared to the whopping 630 terabytes of data that payers have been tasked with posting.

To understand why this is, we first need to look at the recent history of price transparency within the U.S. healthcare system.

The Centers for Medicare and Medicaid Service began enforcing its price transparency rule on the first day of 2021. The law requires hospitals to post their gross charges, payer-specific negotiated charges, de-identified minimum negotiated charges, de-identified maximum negotiated charges and cash prices on their websites in a machine-readable file. It also mandates that hospitals must publish pricing for the 300 most commonly-used services to their website in a consumer-friendly manner.

The rule was the first of its kind, said Carol Skenes, a provider and payer strategist at Turquoise. Since the rule did not provide recommended schemas for machine-readable file creation, hospitals’ first challenge was consolidating all the required data elements and publishing them in a single file. Because of this, there is now wide variability in hospitals’ machine-readable file data, Skenes explained.

This year, CMS began requiring payers to post price transparency data as well. Enforcement began in July. 

To simplify the data extraction process, CMS provided payers with specific schemas to follow when publishing their rate data. Under this guidance, payers are required to post rate data for more than the services they cover at hospitals — they must publish data for all types of providers, such as imaging centers, family practice clinics, and ambulatory surgery centers.

“Payers are responsible for including rates for non-hospital providers, which significantly increases the machine-readable file size,” Skenes said. “On top of that, a payer may have unique contracted rates for thousands of providers they must display. All these factors add up very quickly and make the files seem unwieldy or difficult to parse.”

This means payers’ price transparency data is ripe for innovation, Skenes pointed out. 

In fact, in CMS’ rule for payers, the agency said it expects “that third-party application developers, researchers, regulators and other file users will have the expertise to aggregate, standardize and interpret the pricing information included in the file and translate the pricing information into products, research and market oversight and reforms that will ultimately benefit consumers.”

Payers still have a long way to go when it comes to compliance, due in large part to the mammoth size of the data they have to post. According to Turquoise’s database, 163 payers across the U.S. have posted their rates. These include big names like Aetna, Blue Cross Blue Shield, Centene, Cigna, Elevance, Humana and United Healthcare. The first payer Turquoise detected a machine-readable file for was Central California Alliance for Health.

Hospitals are finally in a better position when it comes to compliance. More than two-thirds of hospitals have now posted machine-readable files with their pricing information. 

“This progress means that when mandated, hospitals and payers will comply with price transparency,” Skenes declared. “Two years is a blip in the usual timeline of the healthcare industry looking to make fundamental changes. We are thrilled to see how much has been achieved in such a short time.”

Photo: eichinger julien, Getty Images

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