The CMS Price Transparency Rule Brings Potential for Growth and Disruption

Key Points in the CMS Rule

As of January 1, 2019, the CMS hospital price transparency rule requires all U.S. hospitals to publicize their list of standard charges online. This mandate is part of the 2019 inpatient and long-term care hospital prospective payment system (IPPS/LTCH PPS). The final rule, which was released in August 2018, lays out CMS’s effort to reduce the ambiguity around healthcare costs for consumers. Here are the main elements of the new rule:

  • The list needs to be available via the internet in a machine-readable format that can be easily imported or read into a computer system
  • Hospitals can choose how to make the charges available on the internet
  • The price list must be updated at least once a year to reflect current hospital prices
  • There are no restrictions on posting quality information or additional price transparency information to accompany the standard price list

Strategize With the Rule in Mind

While transparency may create some confusion as the sticker price may not be the actual cost for the patient, providers can take this into account when formulating their marketing and communications. Video explanations and personalized material like brochures, digital ads, and other collateral are prime examples of getting consumers to trust the process. Studies have shown that healthcare consumers are more engaged when information is made readily available, which is especially helpful when it comes to capturing payments. This data also tells us that technology is going to be a major player in the financial arena of healthcare. Progressive companies can capitalize on this momentum to make the new price transparency rule work in their favor.

Greater Implications for AI

With artificial intelligence continuing to advance in both the medical and professional fields, we’re seeing new pricing tools, cost benefit analysis programs, and more ideations come to fruition. Tech companies in the healthcare space have the potential to create state of the art applications and platforms that link patients and providers together. If leveraged strategically, we can change the conversation from ‘Us vs. Them’ and back to ‘Caregiver and patients’. These tools are not meant to pigeonhole providers pricewise, but to inform healthcare consumers of their patient financial responsibility. If the integration of AI into the healthcare space is thoughtfully executed, the potential to bridge the gap is imminent.

A New Horizon for Innovation

Change can be daunting due to the nature of the uncertainty surrounding it. However, this new adoption is a win-win. When consumers know the financial landscape of their healthcare costs, they are able to set aside funds and utilize employee health benefit options like FHA, potentially ensuring a higher payment capture percentage than year’s prior. So, before providers start sounding the alarm, remember that change brings a wealth of new potential and disruption, ultimately creating a better ecosystem for us all.

CEO of HealthPay24.com. Obsessed with intersection between healthcare & tech. Passionate about trust, transparency, & the patient experience.

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