FY 2015 IPPS Final Rule Reminder: Hospitals Required to Make Pricing Transparent and Available to Patients

While Medicare cannot dictate what a hospital charges for its services, and Medicare does not pay billed charges, the Centers for Medicare and Medicaid (CMS) believes hospital charges remain an important component of our healthcare system. Historically, hospital charges can vary dramatically from one hospital to another, even within a local community. This makes it very challenging for patients to compare the cost of similar services across hospitals.

In 2013, CMS released data that demonstrated the wide variations across the country and within communities in what hospitals charged for a number of common inpatient and outpatient procedures. This data can be viewed at http://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and -Reports/Medicare-Provider-Charge-Data/index.html.
  

As a result of the Affordable Care Act, section 2718(e) of the Public Health Service Act, requires that "each hospital operating within the United States shall for each year establish (and update) and make public (in accordance with guidelines developed by the Secretary) a list of the hospital's standard charges for items and services provided by the hospital, including for diagnosis-related groups established under section 1886(d)(4) of the Social Security Act."

In the FY 2015 IPPS/LTCH PPS proposed rule (79 FR 28169), CMS reminded hospitals of their obligation to comply with the provisions of section 2718(e) of the Public Health Service Act. While not coming forth with any specific mode of communication, CMS encouraged hospitals to take efforts to engage in consumer friendly communication of their charges to help patients understand their potential financial liability. It is expected that hospitals will update their information at least annually to reflect current charges. On an ongoing basis, CMS will continue to review and post on the CMS website relevant hospital and physician charge data.