Today, CMS announced a Hospital Price Transparency Proposal as part of the CY 2024 Hospital Outpatient Prospective Payment System (OPPS) Proposed Rule that includes a standard machine-readable file (MRF) format requirement for hospital transparency disclosures. CMS arrived at this standard through the guidance of industry experts (including yours truly) from across the healthcare landscape.

This proposed requirement deserves a moment of celebration because it furthers the staying power of price transparency. The industry has now moved one step closer to meaningful changes in the patient experience and continues to shape how Americans understand the cost of their own care.

If I’ve said it once, I said it a dozen times in the House Committee on Energy and Commerce hearing in March: a standard schema for hospital MRFs is foundational to accurate and digestible data. The lack of a standard schema up to this point has made it difficult for third parties like my team at Turquoise to create meaningful consumer experiences atop the data from 6,000+ hospitals in the US. As hospitals refresh their data with updated negotiated rates and cash prices, standard schemas simplify the ability to gather updated rates and distribute them to key stakeholders.

The schema templates and accompanying data dictionary brings more specificity to payment methodologies, code types, and naming conventions that will assist us in pulling credible data from the files. It also provides flexibility to create a normalized (tall) or tabular (wide) file, such that hospitals can adopt a file architecture that is minimally burdensome.

The schemas benefit consumers and innovators as well, because the new required fields bring in much-needed clarity and context to the dollar values for each item and service.

For example, the requirement for hospitals to include the payment methodology field makes the files significantly easier to understand. Historically, if an MRF reported a $2,000 negotiated rate for a service, there was no clear understanding of if the amount was a case rate, a per diem, or the base rate that must be multiplied by a code-specific weight. The new files will be required to report both the $2,000 rate and define that rate as a per diem in the payment methodology field.

The result? A better understanding of the many factors that influence healthcare pricing and a clearer path toward estimating the true cost of care.

If finalized, the schema requirement would go into effect on 3/1/2024, which is a 60-day grace period after the Proposed Rule's other policies go into effect on 1/1/2024. Providers will be looking to update, revamp, or rebuild their existing MRFs to ensure timely compliance. Turquoise is here to help! If you’re a hospital, and you’re looking to make changes to your MRF, reach my team here.