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What is Price Transparency Data?

Price transparency is a catch-all phrase for healthcare price transparency data collected directly from CMS-mandated machine-readable files (MRFs). The data within those files is “price transparency data .” Therefore, it’s specifically data published by hospitals or payers that display list, cash, and/or negotiated rates.

What’s in price transparency data?

Hospital MRFs aka Hospital price transparency data

Certain hospitals and providers are mandated by the Hospital Price Transparency Final Rule to disclose their rates. The final rule outlines specific rate types and columns that must be included.

Here is every rate type mandated by the final rule:

  • Gross Charge: Charge for an individual item or service reflected in the hospital’s chargemaster (i.e. list price) 
  • Discounted Cash Price: Charge for an item or service administered by the hospital to a patient who will pay in cash or a cash equivalent
  • Payer-Specific Negotiated Charge: Charge negotiated with a third-party payer for an item or service
  • De-Identified Minimum Negotiated Charge: Lowest charge a hospital has negotiated with all third-party payers for an item or service
  • De-Identified Maximum Negotiated Charge: Highest charge a hospital has negotiated with all third-party payers for an item or service

Other Required Columns: 

  • Charge description
  • Billing code
  • Revenue code

Payer MRFs aka Payer price transparency data

Certain plans and insurers (we refer to this group as “payers”) are mandated by the Transparency In Coverage Final Rule (TiC) to disclose their rates. Payers must post two files containing different rate types and columns.

Here is every rate type mandated by TiC:

In-Network File:

  • HIOS ID or EIN if no HIOS ID
  • Billing Code
  • Place of Service Code, TIN & NPI
  • In-Network Applicable Amounts

Allowed Amounts File:

  • HIOS ID or EIN if no HIOS ID
  • Billing Code
  • Place of Service Code, TIN & NPI
  • Unique Allowed Amounts
  • Historical Billed Charges

Why is price transparency data so groundbreaking for healthcare?

Before the Hospital Final Rule, only a few people knew the negotiated rates between providers and payers. Without that information, there was no way to determine a fair market rate. The lack of public data made it virtually impossible for patients to understand their cost of care before services are rendered.

Thanks to the triumvirate of price transparency rules and laws, everything is out in the open, publicly available, and free to access. That means negotiations can occur using a common data set, and patient estimate tools should be more accurate. 

If you’re struggling to understand the gravity of this data, think of it like this: Imagine if a law passed that mandated every single employer in the United States to publicly disclose exactly how much they pay every single employee, contractor, and vendor in real-time and update that information yearly. 

And, there was also a law that mandated every single employee publicly disclose to their current and future employers exactly how much money they’ve making. That information would change the landscape of employment!

What does this mean for price transparency in healthcare going forward?

Knowing the cost of care has a profound impact on the industry. Though, there’s a lot of work to be done around data interoperability and simplifying service packages to increase packaged pricing. Eventually, complex revenue cycle workflows should be simplified. All of this leads to an experience where patients can research care and cost options up front. They should be able to select their services based in part on their confidence in price. You know, simple.