NAHRI Professional Advocacy Committee offers guidance on CMS price transparency requirements
by Terri Rinker, MT (ASCP), MHA; John D. Settlemyer, MBA, MHA, CPC, CHRI; Jugna Shah, MPH, CHRI; and Amy Rinkle on behalf of the NAHRI Professional Advocacy Committee
As 2019 draws to a close, and as revenue integrity professionals and their organizations look to the future, an important set of decisions and changes await. Among the largest is that to come in 2021 when the new price transparency requirements for hospitals will be in place. CMS finalized the changes in the CY 2020 Hospital Outpatient Prospective Payment System (OPPS) Policy Changes: Price Transparency Requirements for Hospitals to Make Standard Charges Public final rule. While the implementation date delay in the final rule is good news, the finalized changes are substantial, as well as controversial. The AHA and other organizations have already begun to contest the agency’s requirement to post payer-specific negotiated rates via litigation. We encourage revenue integrity professionals and their organizations to make good use of this upcoming year when it comes to price transparency.
While these changes are impactful, they are also the culmination of a series of regulatory steps CMS has taken since the 2019 inpatient prospective payment system final rule to require the public disclosure of charges by hospitals. These steps have marched forward in concert with increased political attention (at times, hostile political attention) on hospitals and growing public concern about the cost of healthcare. In this upcoming year, political scrutiny on hospitals is not likely to decrease. The CMS Office of the Actuary predicted that healthcare spending will rise to 19.4% of GDP in the next decade, and price increases are expected to account for nearly half the growth in personal healthcare spending from 2018 to 2027. Given this, it is inevitable that questions about hospital prices will continue to be raised, as well as responsibilities hospitals have as providers, employers, and community institutions to address rising healthcare costs.
As these costs rise, hospitals and providers are sometimes blamed for the increases. Many lawmakers and policymakers believe the increase is due to the lack of price transparency in healthcare. A CMS spokesperson even said, “Hospitals should be ashamed that they aren’t willing to provide American patients the cost of a service before they purchase it.” While some hospitals cling to the status quo, unwilling to move into the 21st century, many do not. Some members of the general public as well as some politicians perceive all hospitals to be fighting any progress that would reduce healthcare costs. It is important to address this perception along with the operational changes mandated by the final price transparency rule.
Accountability for price transparency
The National Association of Healthcare Revenue Integrity (NAHRI) believes that revenue integrity professionals must maintain an ethic of accountability. We are accountable to our profession, to our organizations, to each other, and most importantly to our patients. We know the work we put in to our profession and the pride we take in that work. As revenue integrity professionals, we know how complex the charging and payment processes are in healthcare. Many professional organizations through comment letters have opposed the burdensome and prescriptive way CMS will require providers to make their prices public.
As part of our advocacy role at NAHRI, we must work to educate lawmakers, policy writers, and the general public about not only the complexities in our field that make price transparency laws difficult to implement, but all the work we currently do to make our prices transparent and meaningful to our patients. Most hospitals are not opposed to providing a price to a patient, but struggle with how to do that within the framework of finalized price transparency requirements. We want to highlight opportunities to improve hospitals’ abilities to provide price information, as well as communicate effectively with patients about healthcare prices. This is in keeping with that value of accountability: to be as transparent on costs as is feasible while also being truthful about the challenges and limitations of price transparency.
One opportunity to do so comes from the exception to the requirement to post 300 shoppable services, which was included in the final rule. CMS stated that it would consider the requirement met if facilities made an online price estimator tool available to patients, which would allow patients to understand their portion of the payment for at least 300 services (and up to 70 CMS-selected services). The estimator must provide patients with a dollar estimate of services. Beyond those requirements, hospitals are free to choose how to design the tool to shape the patient’s interaction with it and can determine what other information the tool will display after the required information. For example, the tool could, at the end, direct patients to the hospital’s financial counselors or explain what is required data to understand the patient’s out-of-pocket expense for a hospital service.
Professional Advocacy Committee guidance
The NAHRI Professional Advocacy Committee would like to provide you some talking points to use in price transparency discussions with others in your organization, patients, and even your own friends and family. We will share some ideas that can be used to help communicate pricing information to others. If we as revenue integrity professionals fail to share our side of the story, we will lose not just the freedom to choose the method in which we share our prices but also the trust of those who depend on us for their healthcare. In a recent HFMA article, researchers identified trust as the single factor that drives patient loyalty.
Important points to convey: Only you and your organization can decide which points will resonate with your patients. There is no one-size-fits-all approach to explaining pricing practices to patients.
- Healthcare pricing and payment is complex
- The 2020 OPPS final rule alone came in at more than 700 pages. Around the same time, we were hit with our annual final rules for inpatient, home care, and physician Medicare payments. Daunting as it may seem, this does not even take into account changes to Medicaid rules or contracts and policies with commercial insurance. There are many elements of hospital charging and billing that are set by laws and regulations, and not by hospitals themselves.
- Consider using an illustration where you break down a single dollar and explain where the money goes. For instance, Medicare, Medicaid, and other insurance companies take 60 cents, charity care takes two cents, bad debt one cent—someone just didn’t pay their bill—hospital staff salaries account for 14 cents, drugs for three cents. Eventually, you end up with a few cents left. If you are a not-for-profit organization, that is the money left for new equipment, new construction, or new programs. Your finance department should be able to help with this exercise in real-dollar terms.
- Hospitals want to care for their patients
- Patients often delay care if they have concerns over cost. Delays in care can present health risks to the patient and lead to missed revenue for the hospital.
- We live and work in the communities where our hospitals are located. When we are sick, we use the same healthcare services as our patients. Our employers pay part of our health insurance premiums and, just like our patients, the other portion comes out of our paychecks. Patients who are footing the bill for hospital care are our friends, family members, and ourselves. We are committed to finding the most cost-effective way to provide healthcare and we are committed to making sure patients have the information they need to make informed decisions.
- A note of caution: Some recent news sources have told stories of hospitals turning people over to collection agencies that then sues a sick, poor patient that would qualify for financial assistance under the hospital’s own policy. Other stories have noted hospitals that sue patients who lost their jobs following a serious health condition. Your hospital leadership must be aware of the collection practices your facility uses so leaders can assure patients that the facility cares about their wellbeing. At the very least, make sure you have cleaned up your processes or are prepared to defend your collection practices in the press.
- Hospitals are already working hard to make prices transparent and understandable through the following efforts:
- Establishing central pricing offices where patients can obtain an estimate that includes their actual out-of-pocket expense
- Working with state hospital associations to provide a single website where patients can obtain price and quality data
- Employing on-site financial counselors to explain how the patient portion of the bill is determined and what options there are for payment (e.g., payment plans, no-interest loans, financial assistance)
- Using price estimator tools to make transparent pricing easier for the consumer to understand and access
The NAHRI Professional Advocacy Committee invites you to consider the following ways in which you can publicize its price transparency efforts:
- Share the ways your organization is working to make prices transparent with friends, families, and patients
- Share information about these efforts with your marketing and communication department(s) so they can do the following:
- Post on your organization’s website
- Post on your organization’s Facebook page, Instagram, LinkedIn, or Twitter
- Send out a press release to local papers and news stations
- Send out a facility newsletter to those in your service area
- Add details to patient billing statements
- Develop a brochure to share with patients
- Encourage hospital representatives to speak out at local events and be prepared to answer public or media questions
Editor’s note: The NAHRI Professional Advocacy Committee is responsible for assisting with the research and development of position papers and other efforts that can help further the revenue integrity profession. NAHRI is currently accepting applications for its Advisory Board and various committees. For more information or to apply for a board or committee position, click here. Professional Advocacy Committee members include Lawrence A. Allen, MBA, CPC, CEMA; Zarina Khabibulina, MD, CCS, CCM, CDIP; William L. Malm, RN, ND, CMAS, CRCR; Terri Rinker, MT (ASCP), MHA; Donna Schneider, RN, MBA, CPHQ, CPC-P, CHC, CPCO, CHPC; John D. Settlemyer, MBA, MHA, CPC, CHRI; Debra Seyfried, MBA, CMPE, CPC-I, CPC; Jugna Shah, MPH, CHRI; and Denise Williams, COC.