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Analysis

Verma Commends 3 Health Systems for Their Price Transparency

By Steven Porter  
   January 10, 2019

The CMS administrator called on other hospitals to do more than required by guidelines that took effect this month.

Three health systems that have voluntarily taken steps to promote price transparency for their patients received kudos Thursday from the head of the Centers for Medicare & Medicaid Services.

During a press call, CMS Administrator Seema Verma named the three systems—UCHealth in Colorado, Mayo Clinic in Minnesota, and University of Utah Health—as exemplars, urging other hospitals to similarly go above and beyond the requirements laid out in revised price-transparency guidelines that took effect this month.

Every hospital in the U.S. is now required to publish a standard list of prices online in a machine-readable format. Even when hospitals publish their chargemasters as required, however, patients may have a tough time finding them, and they are likely to struggle in deciphering the document's medical jargon, acronyms, and atomized list of codes.

That's not to say the new policy isn't working. By requiring the data to be machine-readable, CMS opened a door for problem-solvers to help aggregate and interpret the information to empower consumer decision-making, Verma said.

"Our initiative was really a first step," she said, adding that provider organizations and third parties alike can and should build upon that foundation.

UCHealth
 

UCHealth launched its own custom solution last year that offers individualized price estimates through a patient portal and mobile app for five of its 10 hospitals (with more locations to be added at the end of this quarter).

The platform considers an individual patient's health plan to calculate an estimated price breakdown with expected out-of-pocket costs for more than 150 services, UCHealth spokesperson Dan Weaver tells HealthLeaders. For patients with follow-up questions or inquiries about prices for services not on the list, UCHealth complemented its digital platform with a dedicated hotline.

The project has been in development about 18 months, since UCHealth President and CEO Elizabeth B. Concordia pushed to make cost estimates easier and more accurate in response to consumer demand, Weaver says.

"As high-deductible insurance plans have become more common over the last decade, we've seen more and more patients asking providers for these estimates," he adds.

Since its soft-launch late last summer, the UCHealth platform has been updated with patient-friendly language to replace the ICD-10 codes, acronyms, and abbreviations that make the raw chargemaster incomprehensible to most consumers, Weaver says. The platform has been processing about 400 estimates per week.

U of U Health
 

University of Utah Health similarly devised an online out-of-pocket cost estimator. There are currently fewer than 100 procedures on the platform, but the system plans to add more at the end of this month, says Kathy Delis, administrative director for revenue cycle support services.

A chargemaster alone isn't terribly useful to patients, Delis said. The price of a colonoscopy, for example, may be listed at $1,500 on a chargemaster, but that doesn't include related expenses, such as room costs, physician fees, lab work, medicine, and supplies—which is why University of Utah Health grouped those procedure-related expenses together to offer a more meaningful estimate. Follow-up questions are directed to a hotline.

Delis said the platform, which has been in the works for several years, was motivated by the organization's culture of transparency and a desire to be prepared if asked (or required) to provide out-of-pocket cost estimates.

Mayo Clinic
 

Mayo Clinic Chief Financial Officer Dennis Dahlen says the chargemaster disclosure requirement is one way to boost transparency, though patients need more information to be empowered as consumers.

"Cost and price information should be based on information that allows patients to meaningfully differentiate among providers in choosing the care that is best for themselves and their families," Dahlen says in a statement emailed to HealthLeaders. "Cost information therefore must be presented in the context of quality and outcomes for patients to make choices that best meet their personal goals."

Mayo Clinic has operated an online cost estimator for about four years, a spokesperson says.

There are currently no penalties for hospitals that fail to comply with the requirement to publish their chargemasters, but CMS is considering feedback on a request for information that could lead to tweaks and teeth in future iterations of the policy.

But providers shouldn't sit on their hands, Verma said.

"Hospitals don't have to wait for us to go further in helping their patients understand what care will cost," she said.

Editor's note: This story was updated Friday to include commentary from University of Utah Health.

—Steven Porter is an associate content manager and online news editor for HealthLeaders, a Simplify Compliance brand.


KEY TAKEAWAYS

Hospitals must publish their chargemasters online in a machine-readable format.

Seema Verma lauded the efforts of three health systems that have gone beyond the requirement to boost price transparency.

The end goal should be to give consumers context for their decisionmaking, says Mayo Clinic's CFO.


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