This white paper discusses the impact of the requirement by the Centers for Medicare and Medicaid Services (CMS) for hospitals to make a public list of their standard charges for items and services they provide. This amounts to 300 shoppable services, 70 of which are mandatory and 230 are at the discretion of the hospital. The final rule, released on Nov. 1, 2019, went into effect on Jan. 1, 2021. The white paper covers the five types of standard charges that hospitals are required to make public. It further discusses mandatory services and voluntary services, and provides some considerations. The paper concludes that in a market consisting largely of third-party payors and information asymmetry, increased price transparency can help healthcare consumers make better informed decisions to some extent. Healthcare consumers will continue to find it difficult to shop for services, however, without additional measures.
Below please find an interactive supplement that allows users to explore the impact of moving from the average allowed cost to the XXth percentile allowed cost for each of the 70 CMS-prescribed shoppable services. To better understand this impact in a specific geography, please contact a Milliman consultant.