December 3, 2025 • 51 mins
Join host Chad Mulvany as he shares the latest healthcare policy and legislative updates for the week of December 1, 2025. Later in the episode, Beth Mullins and Alicia Faust of Forvis Mazars and Shawn Stack of the Healthcare Financial Management Association (HFMA) join the podcast to discuss price transparency challenges and opportunities. Hear their perspectives on new compliance requirements in the 2026 Outpatient Prospective Payment System final rule, as well as strategies to leverage price transparency data for managed care negotiations and pricing strategy.
- Washington Watch (0:55)
- Beth Mullins, Alicia Faust, & Shawn Stack Interview (24:19)
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Related content:
- Payor & Hospital Price Transparency Data-Driven Strategy
- Trump Issues New Healthcare Price Transparency Executive Order
View our OBBBA Tuesdays webinar series on demand to explore the healthcare implications of the One Big Beautiful Bill Act and strategies to navigate the changes ahead.
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Download our Mindsets 2025 Healthcare Executive Leadership Report.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
(00:01):
On today's episode of Achieving Health,
I've got the latest policy and legislativeupdates from Washington, D.C.
for the week of December 1st, 2025.
Then we'll have a conversationon new price transparency compliance
requirements, challenges,and opportunities with my Forvis Mazars
colleagues, Beth Mullins and Alicia Faust,and our guest,
Shawn Stack from the HealthcareFinancial Management Association.
(00:23):
Stay tuned.
This is Achieving Health.
A podcast from Forvis Mazars,where we delve into the topics that matter
most to healthcare organizationsacross the continuum of care.
Our goal is to help younavigate the dynamic healthcare landscape
and achieve health at your organization.
Here's your host, Chad Mulvany.
(00:48):
Welcome to Achieving Health.
I'm Chad Mulvany, director inthe Healthcare Practice at Forvis Mazars.
Thank you for joining me.
We'll begin today with our WashingtonWatch segment, where I share
updates on the most recent actionsof federal policymakers
and their anticipated impacton healthcare providers and payers.
Today's WashingtonWatch reflects information as of 10 a.m.
(01:09):
Eastern Time on Monday,December 1st, 2025.
Hope everybody had a wonderfulThanksgiving and was able
to enjoy the great carbloading with friends and family.
My comments on these discussions are basedon what's being reported by the D.C.
trade press at the time of recording,mixed with a lot of judgment
about where things may gobased on my experience in D.C.
(01:31):
So, today's remarks reflect informationas of this moment and will change.
As far as our agenda is concerned,on November 21st, CMS
released its calendar year 2026 OutpatientPerspective Payment System final rule.
CMS estimates that before the recoupmentrelated to the 340B separately
payable Part B drug settlement,changes in the rule will increase
(01:54):
OPPS paymentsby $1.77 billion in calendar year 2026,
excluding changes in enrollmentcase mix in utilization.
For providerssubject to it, the 340B remedy offset
is estimated to reduce paymentsby $270 million,
which was reduced from the proposed impactestimate of $1.1 billion.
(02:17):
So that's a huge, if temporary, win.
We'll also cover a couple of the other keyprovisions in the rule in the segment.
We'll also get into President Trumpteasing a healthcare plan.
It was reported last weekthat President Trump
would announce a hybrid healthcare planto address affordability issues.
However, the anticipated healthcare planannouncement was delayed
(02:41):
if not kiboshed, amid confusionand pushback amongst Republicans.
We'll cover what was reportedly in itand provide some thoughts on where,
with not many legislating daysleft to go before
premium year starts,how affordability efforts may shake out.
CMS also issued
preliminary guidanceon a couple of One Big Beautiful
(03:04):
Bill Actprovisions related to provider taxes.
And so, on November 17th,there was preliminary guidance
clarifying the definitions of enactedand imposed
for applying new indirecthold harmless thresholds
and also outlining a transition periodfor noncompliant taxes.
While the guidance isn't good,it was certainly about what was expected.
(03:28):
And then finally,right before Thanksgiving,
we got the Medicare Advantageproposed rule.
And so on Tuesday the 25th, CMS releasedits proposed rule for contract
year 2027 that would revisethe Medicare Advantage program.
The main update init is related to the star ratings process.
There are also some changesthat will streamline enrollment processes
(03:49):
and codify provisionsfrom the Inflation Reduction Act of 2022.
So, with that, let's get into it.
In terms of the OPPS final rule,beyond the payment update and recoupment
related to 340B, CMS finalizesfielding a drug cost acquisition survey.
It implements site-neutral payments
for drug infusionservices in excepted off campus HOPDs.
(04:12):
It also modifies price transparencyrequirements and phases out the inpatient
only list while expanding the ASCcovered procedures list.
And, just a note on price transparency,I'm going to defer to my friends Beth,
Alicia, and Shawn to cover this detailin the second portion of this episode.
Certainly, a great conversation
(04:33):
and if you were tempted to drop offafter Washington Watch,
I'd encourage you to stick aroundas they deliver the goods and then some.
Again, what I will sayabout what I will cover on
OPPS, please note that it's not intendedto be an exhaustive discussion,
but just kind of cover some of the keythings quickly at a very high level.
In terms of the paymentupdate, CMS was on brand
(04:54):
with a market basket updatethat was less than input price inflation.
And so the net market basketupdate was 2.6%,
which was 3.3% gross reducedby the mandated 7/10 percent productivity
adjustment for hospitals meetingoutpatient quality reporting requirements.
This was increased from 2.4% proposed,and not a surprise
(05:15):
given that the OPPS market basketupdate, by statute,
has to follow the IPPSfinal rule market basket update.
Afterbudget neutrality and other adjustments,
the resulting OPPS conversionfactor is $91.41, or $91.415.
As proposed, it was $91.747,
(05:38):
and that's before the 340B recoupment.
Despite the increased net market basketupdate, the decrease in the area wage
index budget neutrality adjustmentfrom proposed 1.0116
to final .9990 drove
the reductionin the OPPS conversion factor.
And then for those hospitals subjectto the half a percentage point 340B
(06:02):
remedy offset,which was decreased from 2%,
the final rule conversionfactor lands at $90.96, or $90.967,
and certainlythat was increased from $89.958,
which works outto a little more than a 2% increase,
net of all adjustments for those hospitalsmeeting quality reporting requirements.
(06:24):
As I didmention, CMS did not finalize its proposal
to increase recoupment of fundsrelated to the overturned 340B separately
payable Part B drug policy at 2%.
Instead, recoupment will beginon January 1st at the previously finalized
rate of a half a percentage pointand will impact services
with status indicators of J1, J2,P, Q1, Q2, Q3,
(06:48):
R, S, S1, T, U, V.
Recoupment does not apply to providersthat began billing
Medicare under OPPSafter January 1st, 2018.
The final rule also notes that CMSanticipates implementing a larger percent
reduction, such as the 2% reductionor other reduction beginning in 2027.
(07:10):
So, what CMS is suggesting here
is that we may have temporarilydodged a much bigger cut.
The rule also finalized the proposalfor site neutral payment
for drug administration services,provided in accepted HOPDs,
and so beginning in calendar year 2026,
CMS will pay for drug administrationservices provided in those accepted
(07:32):
off-campus HOPDs,so those billing with the PO modifier
at the physician fee schedule equivalent,which is 40% of the applicable APC rate.
The policy will only apply to APCs 5691
through 5694,and does not apply to the drugs
that are administered;it's just the code for administration.
(07:54):
The agency estimates in 2026it will save $290 million.
$220 million of that is saved by CMS,$70 million of
that is saved by beneficiaries.
And like the site-neutral clinic visitpolicy, CMS exempts
sole community hospitals from this change.
CMS applies
this policy changein a non-budget-neutral manner.
(08:14):
It justifies this action as a quoteunquote “volume control method”
and cites the growth in spending and drugadministration services
provided in accepted OPDsas the rationale.
It's worth noting that CMS usedthe same justification when it applied
site neutral payments to clinic visitsprovided in accepted off-campus HOPDs.
While hospitals challenged
(08:35):
the clinic visit policy in court,it was upheld by a federal appeals court,
and the Supreme Courtdeclined to hear the appeal.
However, that ruling occurred priorto the Supreme Court's decision
in Loper Bright,
which overturned the legalChevron doctrine, which required courts
to defer to federal agenciesreasonable interpretations
of ambiguous statutes they administer,which may create an opportunity
(08:57):
for a legal challenge to this policy.
CMS, also in the proposed rule, requestedfeedback on expanding site-neutral clinic
visit policy to apply to clinic servicesprovided in on-campus HOPDs.
While CMS did not providea summary of those comments, it notes
it received a range of commentsrelated to expanding site-neutral payments
(09:18):
and those comments touched on on-campusclinic visits,
imaging services without contrast,and off-campus provider-based departments
and other services that it contendsto consider in future rulemaking.
It also sought feedbackfor developing a systemic process
for identifying ambulatory servicesat risk of being shifted
to more expensive, hospital-based settingsdue to financial incentives.
(09:41):
Similarly, like the questionabout extending the policy to on-campus
clinic visits,
it did not summarize these comments,but notes it received
43 pieces of feedback and may take theminto consideration in future rulemaking.
CMS also
finalized the timelinefor its outpatient drug pricing survey,
and so in response to President Trump's
(10:02):
executive order related to drug pricing,CMS will field
a drug cost acquisition surveyfor covered hospital outpatient drugs.
Based on the final rule, the agency willfield the survey in early 2026.
Hospitals will have 90 days to respond,so the survey can be completed
in time for the resultsto inform the 2027 OPPS proposed rule.
(10:24):
In addition to drug acquisition prices,the survey will require hospitals
to report all discounts, rebates,and other price concessions
that are provided,including the 340B discounts.
It's likely the results of the surveywill be used to reprise a reduction
in payment for separately payable PartB drugs acquired under the 340B program.
(10:44):
Given there were response rate issueswhen the prior Trump administration
attempted to field a similar surveyin spring of 2020,
the proposed rule also consideredapproaches to account for non-responses
to ensure the data set providesa large enough sample size
to be statistically reliableand meet statutory requirements.
(11:05):
Based on this commentaryand responses to comments,
CMS may assume that if a hospitaldoes not respond to the survey,
its outpatientdrug costs are not significant.
As a result, it discussedassigning these hospitals to the lowest
reported acquisition costsfor its peer group in the proposed rule.
The proposed rule also notedthat CMS may consider expanding packaging
in some instances,
(11:26):
as low response rates might indicateinsignificant outpatient drug costs.
The final rule also clarifiesthat CMS has made no decision on how,
if at all,it will account for non-responses and
any policies related to non-responseswill be included in future rulemaking
after CMS has had an opportunityto analyze the data.
In terms of phasing outthe inpatient-only list, as proposed
(11:50):
beginning in calendar year2026, CMS will phase out the inpatient
only list over three years,starting with 285 CPT codes
that are for mostly musculoskeletalservices.
The servicesCMS removes are listed in table
119, page 888 of the display copy.
(12:10):
Correspondingly, CMS creates a seven-levelmusculoskeletal procedure APC,
to which it will assignprocedures removed from the list
based on applicable estimated cost.
CMS will complete this phaseoutby calendar year 2029.
CMS will continue exempting proceduresthat have been removed from the IPO list
for medical review activities to assesscompliance with the two midnight rule,
(12:34):
until the Secretary determinesthat the service or procedure
is more commonly performed in the Medicarepopulation in the outpatient setting.
It's also important to remember
that Medicare Advantage plansshould also be adhering to this guidance.
In terms of the changes to the AIC coveredprocedure list, the final rule expands
the AIC covered procedure listby 560 services.
(12:56):
So, this is 289 procedures in general,and then includes an additional 271
that were removedfrom the inpatient-only list.
The list of proceduresCMS adds are included
in tables 131 and 132in the display version of the final rule,
and so these begin on page 1068.
(13:18):
Final rulealso includes a requirement for hospitals
to report their Medicare Advantagenegotiated rates,
with the idea that these will be usedin calculating MS-DRG rates in the future.
And so, for cost reporting periodsending on or after January 1st, 2026,
(13:38):
CMS requires hospitals to include,in their Medicare cost reports,
the median of their negotiated MedicareAdvantage rates for all plans.
This data would comefrom the most recent version
of its price transparency machinereadable file.
Critical access hospitals are excludedfrom this requirement.
Instructions for reporting this dataon the cost report are discussed
(14:01):
in an information collection request, andthat will be included in the show notes.
CMS also intends to use this datafor setting MS-DRG
weights effectivefor Fed fiscal year 2029.
The agency believesthere is a need to reduce reliance
on hospital chargemastersand develop market-based approaches
(14:21):
to establishing payment ratesunder the Medicare Fee-for-Service system.
The prior Trump administration
also included this policy in the 2021 IPPSfinal rule,
which was repealed by the Bidenadministration in the 2022 IPPS rule.
Shifting gears,
President Trump on November 23rd
teased a health plan to addressaffordability issues.
(14:44):
It was reported that the presidentwould announce a hybrid health plan
that would addresssome of the affordability issues
that could imperil Republicans’majority in the House and possibly
cost them a pickup seat opportunityin the Senate in Georgia.
However, the anticipated healthcareplan has been at least delayed,
if not had the kibosh put on it, amidconfusion and pushback from Republicans,
(15:09):
many of whom were surprisedby the proposal’s direction.
The plan was reported to includea two-year extension of the enhanced
ACA subsidies, but with income caps
and also minimum premium payments
in an option for enrollees to divert partof their tax credit into savings
accounts, either an FSA or HSA,if they chose lower cost plans.
(15:32):
While an extension of the exchangesubsidies is not popular
with most Republicans,the restrictions to subsidy eligibility
and the HSA provisions alignwith conservative priorities.
However, the president, as I mentioned,has since walked back support for a
two-year extension while leaving the dooropen for some kind of change.
Democrats reactions ranged from cautiouslyoptimistic to outright rejection.
(15:57):
Senator Jeanne Shaheen of New Hampshirewelcomed the possibility
of bipartisan talks,
noting that the president's involvementcould signal a serious negotiating effort,
especially ahead of a December voteon extending subsidies.
However, top House Democrats dismissedthe proposal as recycled Republican ideas
that fail to protect consumersfrom looming premium hikes.
(16:18):
With Republicans divided and Democratssplit between negotiation and opposition,
the president's healthcare planremains in limbo, leaving the future
of ACA subsidies and any small borehealthcare reform uncertain.
If the presidentdoes lean in and introduce
a healthcare affordability planthat includes an extension of the enhanced
exchange subsidies, it improvesthe likelihood they are extended.
(16:41):
However, I'm not sure by how much.
As I mentioned earlier,an extension of the subsidies
remains unpopular with conservativeRepublicans in the House and the Senate.
Those obviously in safe districtsor in solidly red states,
in the optics of passing a healthcare billin both the House
and Senate, supported by onlya minority of Republicans, is a bad
(17:02):
look for both Majority LeaderThune and Speaker Johnson,
who has already had enough of a challengerecently managing his caucus.
Speaking of, it's reportedthat more than 85 House Republicans
have expressed their support foran extension of the enhanced tax credits.
It's possible that enough of this cohortwill work with Democrats in the House
to file a discharge petition for a voteon the extended subsidies in that chamber.
(17:26):
If that occurs, it's likelyan extension of the enhanced subsidies
would pass the House with lessthan majority Republican support.
However, I still don't thinkthere are votes in the Senate.
Majority Leader Thune
makes good on his commitmentto hold a vote on extending the subsidies.
The other things here to watchare the potential offsets,
in additionto the existing list of potential offsets.
(17:48):
So, think PBM reform,further expansion of Medicare site-neutral
payments, the No UPCODE Act,which would impact MA plans.
It's reported that President Trump,if he had rolled out a healthcare plan,
was considering codifying his most favorednation's drug pricing policy.
While details are scarceon what this entails,
and there are two rules under reviewwith the Office of Management and Budget
(18:09):
that are likely related to it,it's possible that it would again
impact Medicare payment for PartB, separately payable drugs.
And while a straight extensionof the enhanced subsidies
without an offsetwill benefit all providers,
if the cost is offset,and that's, I'm assuming it will be,
how that occurs will determine whetheror not an extension of the subsidies
(18:30):
benefits a specific provider or not,and that will likely break down
between expansionand non-expansion states.
Moving on to OB3,
on November 17th, CMS issuedpreliminary guidance
implementing the provider tax provisionsof the One Big Beautiful Bill Act,
and this guidanceclarified definitions of enacted
(18:50):
and imposed for implying new indirecthold harmless thresholds
and also outlined a transition periodfor noncompliant taxes.
As a bit of background,under section 71115 of OB3,
new indirect hold harmless thresholds.
Effective October 1st, 2026, non-expansionstates are limited to provider taxes
(19:11):
enacted and imposed as of July 4th, 2025,
while expansion states facephasedown thresholds starting at 5.5%
in fed fiscal year 2028,declining to 3.5% by fed fiscal year 2032.
States without provider taxesas of that date are capped at 0%.
In section 71113, closing a regulatoryloophole,
(19:35):
this tightens rulesfor waiving the uniformity standard
by prohibiting tax structures that favor
or penalize providersbased on Medicaid participation or volume,
with the HHS secretary authorizedto establish a transition period of up
to three years for taxes failingto meet the new redistributive criteria.
With that out of the way, let'sget to the guidance.
So, for section 71115,the new indirect harmless thresholds,
(20:01):
CMS clarified which provider taxes fall
under the new hold harmless thresholdsby defining enacted and imposed.
A tax is considered enactedif all legislative steps were completed
and any necessary CMSwaiver was approved by January 4th, 2025,
with later adjustmentsexcluded from this definition.
(20:22):
Imposed means the state was activelycollecting revenue under that
tax structure as of July 4th, 2025and any proposals pending or submitted
after that date would not counttowards threshold calculations.
The new indirect hold harmless thresholdsestablished
by section 71115 of OB3
will take effect on October 1st, 2026.
(20:45):
In section 71117, Closing a regulatoryloophole,
CMS’ guidance under the OB3 restatesthe updated criteria for determining
whether a tax is consideredgenerally redistributive.
To help states comply, CMS set transitiondeadlines.
Managed care organization taxes must meetrequirements by the end of the state's
(21:07):
fiscal year in 2026,while all other affected taxes must comply
by the end of fiscal year in 2028,but no later than 10/1/28.
The agency emphasized that these timelinesare the minimum transition periods,
with the possibility of granting up
to three fiscal yearsdepending on final rule making.
(21:29):
The guidance isn't good, but obviouslyit's about what was expected.
Section71115 will impact counties and states
that quickly passed provider tax increasesbefore OB3’s enactment but were unable
to either one, get a waiverassociated with the tax approved by CMS
and or two, actually collect proceedsfrom the class of tax providers.
(21:52):
While
CMS will allow these new taxesthat didn't get across the finish line
to go into effect, the tax ratemust come back down by 10/1/26.
Allegedly,CMS is calling states to inform them
if they were impactedby the preliminary guidance.
CMS is not anticipated to publish a list,
so the extent of the impact is unclearand will likely remain so for a bit.
(22:13):
Given this was preliminary guidance,there is a chance that CMS reconsiders.
However, I think the odds of thisare probably long given
they knew what they were doing whenthey issued this preliminary document.
Finally, on Tuesday,November 25th, the Centers for Medicare
and Medicaid Services releaseda proposed rule for contract year 2027
that would revise the Medicare Advantageprogram, rule updates, star ratings,
(22:36):
streamlines enrollment process
and codifies provisions from the InflationReduction Act 2022.
Key changes to the star rating systeminclude removing 12 measures
that focus on administrative processeswith little variation in performance,
while adding a new depression
screening and follow upmeasure to address behavioral health gaps.
CMS also decided not to implementthe previously planned
(22:58):
Excellent Health Outcomes for All reward.
Insteadcontinuing the historical reward factor
that emphasizes consistent highperformance across all measures.
These adjustments aim to reduceadministrative burden and refocus
the program on clinical care outcomesand patient experience,
where meaningful differencesexist among plans.
The proposal also addressesenrollment and drug benefit reforms.
(23:21):
CMS plans to expand special enrollmentperiods to make it easier
for beneficiaries to switch planswhen providers leave their network,
and to codify policiesrequiring CMS approval
for certain special enrollment periodsto ensure transparency.
Additionally, CMS seeks to codifymajor Part D reforms from the Inflation
Reduction Act, such as eliminating
the coverage gap, lowering out-of-pocketthresholds, removing catastrophic
(23:45):
phasein cost sharing, and implementingthe manufacturer discount program.
Finally, CMS clarifies that cannabisproducts, illegal under federal or state
law, cannot be offered as supplementalbenefits for chronically ill enrollees,
aligning MA policies with federal lawwhile maintaining safeguards.
This concludes today's Washington Watch.
(24:05):
Up next, we'll have a conversation onprice transparency between my colleagues,
Alicia Faust and Beth Mullins,and our guest, Shawn Stack from HFMA.
I'd like to welcome our guests for today's
episode, Beth Mullins,Alicia Faust, and Shawn Stack.
Beth is a principal in the HealthcareConsulting practice at Forvis Mazars.
(24:29):
Her work focuses on managed carestrategy and contracting, including rate
benchmarking and negotiations,supported by price transparency data.
Alicia is a partner on our HealthcareConsulting team
with a focus on revenuecycle improvement and revenue integrity.
She supports clients with pricetransparency compliance and reporting,
(24:49):
and she also helps them leverage pricetransparency data
to support pricing strategyand also monitoring payment variances.
Finally, we have Shawn Stack, Directorof Perspectives and Analysis at HFMA.
Shawn is here to provide a policyperspective on price transparency
in the recently finalized 2026Outpatient Perspective Payment System rule
(25:12):
and give his thoughts on futuredevelopments in price transparency.
Thank you all for being here.
Beth, I'll turn it over to youto get the conversation started.
Thank you, Chad.
Well, the new OPPS final rule has come out
and Shawn, how did the final rule change
the price transparency requirementsthat hospitals must meet?
(25:34):
Great Beth.
Well, yeah, the final rule.
Really, I mean, CMS largely finalizedthe price transparency changes
as proposed, but added a little bitof important operational and compliance
clarifications that hospitalsneed to understand heading into 2026.
The biggest shiftis the formal replacement of the estimated
(25:56):
allowed amounts with the actual percentilebased allowed amounts.
That 10th, median, and 90th percentiles,
plus a number of data points used.
The final rule adds technical instructionslike rounding rules, requires
a 12- to 15-month lookback, and allowsequivalent remittance data sources
(26:17):
beyond the EDI 835that was in the proposed rule.
It also updates the attestation languageand finalizes that and expands it a bit.
Hospitals must testify, or attest,I should say,
not only that the MRF is accurate,
but that algorithmic based rates included
(26:40):
all components necessary for the publicto derive dollarized pricing.
CMS also finalized the requirementto encode the CEO
or senior official responsiblefor that attestation language.
The final rule also talksabout NPI requirements.
It tightens the NPI requirement.
(27:02):
Hospitals must now report type two NPIs
specifically tied to hospitaltaxonomy codes 27 and 28.
And it also continued that languagethat was in the proposed rule
around the approvedproposed 35% reduction
in civil monetary penalties for hospitalsthat waive appeal rights.
(27:24):
It did carve out any noncompliance relatedto core requirements, such as failing
to post an MRF or shoppable services,
away from that 35% reduction.
And then last but not least,the final rule did allow
a little bit of variationon effective versus enforcement dates.
(27:45):
While January 1st, 2026
remains the effective datefor the new requirements,
the agency did introducea new three-month enforcement delay
where CMS will not enforcethese provisions until April 1st of 2026,
giving hospitals a little bit of timeto operationalize those new elements.
(28:06):
Great. Thank you.
Alicia, what are you hearing from clientsabout the new requirements?
The new requirementswill continue to be burdensome
and that's kind of whatwe're hearing around the country.
The allowed amounts, as Shawn mentioned,continue to be a challenge, mostly
because all of the fields of the 835s
(28:27):
are not requiredto be filled out by the payers.
This, along with complex reimbursementmethodologies, as well as the edits
that we're not able to see, really dopresent
challenges onhow we get to the allowed amount.
The addition of the additionalNPIs is also going to be a challenge
for organizations,particularly around behavioral health,
(28:49):
which I think many of them did not includepreviously as a hospital unit.
And we're seeing that being addedaround the country.
The 90th and 10th percentile
will be a challenge as well,because we have to be able
to identify that allowed amountin those specificities.
There is some language aroundwhat rounding is going to be.
(29:12):
However, organizationsare going to have to be meticulous
in their calculationsin order to get there.
So, I think folks are nervous.
I also thinkthat they are even more nervous
about the attestationbeing at the most executive level, most
seniorexecutive levels of their organizations,
which is more in linewith what we see on the cost report side.
(29:35):
Great. Thanks, Alicia.
Shawn, what are you hearing?
Yeah.
So, Beth, very similarto what Alicia's hearing.
On a general level, I think folks rightnow are still processing the rule, right?
They're still analyzingwhat these impacts are going to be.
I think timelines for complianceare extremely tight,
even given that new 90-day windowfor enforcement,
(29:56):
and administrative burden will be highgiven the size of these files.
Many organizationswere set to refresh their MRFs in January
based on that annual update requirement,
and then they immediatelyhave to implement new fields
and meet the updatedcompliance requirements by April 1st.
So that's going to be a heavy lift.
But I think once providers really diginto the attestation language
(30:20):
that Alicia talked aboutin that final rule and recognize
how broadly the operational requirementsapply across multiple scenarios,
I expect the angst to ramp up quickly,and I think
we're all going to be getting callsfrom our members and clients.
Alicia, just in terms of compliance,are there
some of the componentsthat are more concerning than others,
(30:43):
just in terms of meeting that compliancein that time frame?
Yes. I think the allowed amount isdefinitely the highest concern for folks.
Most hospitals continue to strugglewith just getting their contracts
from their payers to be able to meetwhat was historically
the minimal requirementfrom an allowed amount.
They have to nowgo back to using the 835s and calculate
(31:06):
at the additional percentileswill create additional work
for most organizationsthat really don't have the sophistication
in order to read those 835sbeyond what they use for charge posting.
In addition to that,while the NPI reconciliations
are not complex,it is going to take additional time
for them to get that data in their MRFs,and then everything that they do from
(31:31):
that perspective will have to also flowto their shoppable services.
So, as organizations are looking to comply
with this review requirement, it'snot only on the MRF,
but also on the shoppable servicesfor both.
So, Shawn,if you're looking into your crystal ball,
where do you think the administration andCMS will go next on price transparency?
(31:56):
Next on price transparency.
Oh, boy.
Well, my crystal ball basically
shattered the day the OPPS proposedrule dropped, so that's out the window.
So, that tells youhow unpredictable things have been.
But if I had to put money on what's nextin the regulatory
laser beam line up, it'sno surprise act enforcement, right?
(32:18):
I think shoppable services and priceestimator tools
are of high focus by the administrationand their stakeholders.
The advanced EOB and all-inclusive good
faith estimates,are certainly going to be next.
And a pretty cleardrift toward exact pricing,
especially for shoppable services.
(32:38):
So, I think there's going to be someheavy lifts coming from the administration
and from the agencies.
So, I think we should buckle up,or at least
make sure you rest up over the holidaybreak.
Got it.
So, Shawn, what does this meanfor hospitals and health systems?
I mean,
you can see the administrationand its advisors
starting to show more interest in holdingpayers accountable for TIC files,
(33:04):
especially nowthat they're trying to line up hospital
files against those payer filesto judge accuracy and usefulness.
But I'm not overly optimisticthat federal oversight of payer
TIC filescompliance is going to gain much traction.
The audit authority is murky.
And the question is,is it state or federal?
(33:24):
It's previouslybeen left in the state's hands
and even the federal contractordoesn't really have the bandwidth
for large scaleTIC audits based on what I'm hearing.
So, for now,I think the scrutiny is going to stay
focused on hospitals and providersfor the foreseeable future.
That's just my two cents.
So, I think hospitals are going to have tobalance what is most,
(33:47):
you know,what are those items that they can get
as compliant as possiblebased on these very murky directives
from the administrationand from the agencies.
So, Alicia, just in terms of wherewe think the administration may be going,
what do you think it means for hospitalsand health systems from your perspective?
(34:09):
So, I agree with Shawn.
I don't think that the administrationhas the ability to do what I think
they ultimately want to do,whether we're 12 months or 24 months away
from it,is really reconciling these two files.
So, the payer fileshistorically have required NPI
so that they could clearly identifythe hospital and plan
(34:31):
associated with that reimbursed amount,or the allowed amount.
The hospitals did not require that.
This new directive that requires hospitalsto publish their NPI makes it
a little bit easier for the administrationto reconcile those two data sets.
To my earlier comment,is it going to become
he said she said ofwho published the right rates?
(34:54):
Is it the hospital file that's correct,or is it the payer file that's correct?
And what does CMS plan to dowith this information?
In the future,
what we're talking to our clientsabout is, although they're probably
several months away from that auditprogram, organizations,
hospitals, and health systemsneed to start preparing for it now.
(35:15):
So while in the pastI think they kind of skirted by
still using some estimated amount,still potentially omitting
some pretty significant reimbursementby payers that they've negotiated with,
all of that comes to a haltbecause the cosmetic audit
is going to come to an end
and an actual audit of the allowed amountsis going to start to be enforced.
(35:38):
Yeah, that's that's a good point, Alicia.
And I've been hearing from my sourcesat CMS and in the agencies
that there's a lot, there's a great dealof talk ramping up around desktop audits.
And of course, we knowthat means looking at payer addendums,
contract addendums and things like that.
So yeah, I agree with you 100%.
Okay, Beth, I've been in the hotseat here for too long;
(35:59):
let's see what you have for us.
And I say thatbecause I think most listeners who know
both of us know you're smarter than meanyway.
So, I want to pull youinto this conversation
and flip the table here a little bit.
So, what opportunities do hospitalshave to use price transparency data
for market assessment and items?
(36:21):
Yeah, that's a good question, John.
Hospitals are and should continueto use the price transparency data
to benchmark their negotiated ratewith peer hospitals in their states.
The payers are using this datato leverage lower rates from hospitals.
So, in many casesthe payers are cherry picking rates
to their advantage during contractnegotiations with hospitals.
(36:44):
So, the hospitals really doneed to be aware
of how their pricing,their negotiated rates, align
with other hospitals in their communitiesand their states
in order to really maximizetheir opportunities
and manage their riskswith their negotiations.
Great.
Alicia, any thoughts here on this topic?
(37:05):
Absolutely.
So that kind of hit the nail on the headthat we should be using this data
to help us negotiate our contracts,but part of what we also see hospitals
and health systems using this data foris for their own market position
benchmarking on howthey're actually charging the patients
and the prices that they are chargingto patients specifically.
(37:27):
What they need to be doingis really looking to understand
from those contract amounts, dothey have lesser than language,
and are they leaving dollars on the tablebecause their prices
top line tothe consumer is not appropriate?
So, we have been using this, in tandemwith Beth,
to look at the top line to ensurethat we're maximizing our contracts.
(37:49):
And then Beth and her team
use it to help negotiate even better ratesthan what we already have.
So, I know youguys have been having these conversations
and doing this workwith a lot of your clients.
Can you give me a granular exampleof how this knowledge
has helped inform managed carenegotiating strategy?
Beth, do you want to go first,
since I know you're working really closelywith your clients on this?
(38:11):
So, we've worked with numerous hospitalson rate
benchmarking analyses, and in many cases
it highlighted tremendousfinancial opportunities for the hospitals.
It's really very compellingactionable data
and the hospitals were ableto use that data
in that analysis to renegotiatetheir rates to better align with peers.
(38:33):
And significant financial upsideand opportunity for those hospitals
that were very knowledgeable abouthow their pricing compared to their peers.
Great point. Alicia?
Yes. Similarly,so when we look at the actual
reimbursements across the table,it highlighted for us the disparate
negotiating tactics
(38:53):
that the payers have been usingacross the country for a very long time.
So, your reimbursement withinyour organization was only as good as
the person sitting across from the payerwhen that negotiation was taking place.
Historically,we did not have access to this
information, and the access we didhave was very, very costly.
(39:14):
For the first time, we actually haveFreedom of Information Act.
This information is public information.
We are now able to understandour organization compared to our peers
that are right down the street,the peers that are in our city.
And then from a national perspective,even though the cost of care
really should be levelset across the country.
(39:35):
But Alicia, don't plans have access
to the same data and aren'tthey using it as well?
They are.
And unfortunately for us,they've been using this data
for a longer period of time purelybecause they had their own data
to manipulate and really identify
based on what they've negotiatedwith individual hospitals.
(39:55):
So previously they had access to their ownnegotiating rates
and were using that in order to negotiatewith hospitals.
This basically opened the field to thembecause now they have access
to their peers.
So United has access to Aetna.
Aetna has access to Blue Cross.
Blue Cross has access to Humana.
What it did is itgave them even more information
(40:18):
that they historicallyhad beyond their own negotiating.
And yes, they are accessing it.
They've been using it for a long time.
So they know how to access it.
They still have a lot of the work to dothat we're doing on the hospital side
in order to make that data usable,but they are definitely leveraging it
in their current negotiationsand probably future negotiations.
(40:39):
So, it seems like the hospital’sDavid, in this scenario,
and the payer’skind of a Goliath scenario here.
Sounds like
this price
transparency data is maybe giving Davidsome steroids.
Beth,are you seeing that in your negotiations
with hospitals and managed careagreements on behalf of hospitals?
(40:59):
Are you seeing this data greatly helpand kind of boost
the clarity that the providersare able to take into those conversations?
Yeah, absolutely.
Certainly, the hospitals,if they have done their research
and understand where they arefrom a pricing perspective versus
their peers, thatit certainly gives them actionable data
and then to know where to pushon those rates.
(41:22):
And, you know,we negotiate managed care agreements
on behalf of hospitals every dayand we're seeing the payers
now armed with this information,they're using it to try to get hospitals
to take decreases or minimize increases,like I mentioned before.
With the cherry picking of the data,the payers are,
you know, picking different piecesof the rates to try to force the hospital
(41:45):
to take a reduction in certain areas.
Which is why it's more importantto do that overall assessment
where your pricing comparesto a rate benchmarking exercise.
So, you know, in totality,how your rates align
not just at the individual codelevel or service line level.
And so, in most cases,we're able to use those analyzes
that we're doing on rate benchmarkingto counter the payers information
(42:09):
with more precise datathat we have access to.
So, Beth, I'm hearing you're right.
You're kind of saying,you know, even if you're a provider
or a hospital in a region where you thinkyou're getting fairly fair prices,
this data is just as important for youbecause you need to go into these
negotiationsvery well prepared as you always have.
(42:32):
But this gives you more insightinto more defensive strategy
and not taking reductions in payments,right?
Yes, we have quite a few clientswhere the benchmarking analysis showed
they were at top of the marketin terms of their rates.
So, it really then became importantfor them to ensure
(42:52):
that their rates align from payer to payerso that there's parity in their pricing.
So that at the top of the market,at least, the payer A
is competitive with payerB, if that makes sense.
In terms of, and it dials into thatdefensive strategy, is
how do we justify pricing andthat articulating that defensible pricing.
(43:15):
Great.
Yeah.
Because keeping in mind that the value ofhealthcare is not just pricing, right?
It's clinical outcomes.
It's length of stay, it's readmissionrates.
It's everything that goes into this.
So yeah, that data,all this data together is what I think
is what you guys are sayingis, it really helps prepare
those robust conversationswhen managed care contracts are due.
(43:37):
What are some of the challenges of workingwith hospital price transparency data
and the health plan transparencyin the TIC files?
Alicia?
There are several challengesworking with those files.
I'll take them independent of each other,but on the hospital side,
the files continue to be inconsistentin what they're reporting.
(43:57):
They continue to be noncompliantwith all of the components that they need.
Many organizations reallyare still not reporting all of the payers
that they have contracts with, simplybecause they don't have access
to the fee schedulesthat are required in order to publish.
While CMS has standardizedthe template, that's about it.
The underlying data still is very,
(44:20):
very questionablefor many hospitals across the country.
On the health plan side,while I think the schema came out
and was a little more consistent,the amount of data that they flooded
the market with is unsurmountable.
And so, folksare having to take a lot of time
to kind of sift through that,because we want to ensure
that we're comparing apples to applesand not apples to oranges.
(44:43):
So, if you have the wrong planselected on the payer side,
compared to the hospital side,you could be misrepresenting what
that patient amount from a price, as well
as from a reimbursement to the hospitalmay really be.
So, it's really looking at those filesindependently, really understanding
what is being publishedin order to make it usable
(45:06):
and presentable for your organization.
And then, Beth, what are you seeingas some of the challenges?
Well, when using the data for ratebenchmarking purposes,
we typically utilize the payer pricetransparency files.
We find them to be more consistentand reliable than the hospital files.
However,those files are terabytes of data,
(45:28):
and they're quite largeand difficult to navigate.
So, they really do require
expertise and experience to garnerthe data required for benchmarking.
Interesting.
And what lessonsyou guys, just wrapping up here
kind of, what lessonshave you learned from helping providers
(45:49):
improve their managed care contractsthat you think
may be under appreciated by,you know, our listeners?
What are those key opportunitiesor those a-ha moments
that you guyshave had going through this process
because you spent so much timein this area?
What are kind of those pointsthat you want to get across?
Beth, I'll let you go first.
(46:09):
Well, Shawn, the data not only allowshospitals to see how their rates compare
on an aggregate basis, but they also allowbenchmarking at the service line level.
This really allows hospitalsto better develop their rate proposals
to payers to focus on service lineswhere there is a rate gap.
So, for example, the rate benchmarkinganalyses will show them for inpatient
(46:32):
services, how their rates align,how their emergency room rates align,
surgery, all different service level information.
So, it really allows themto tailor their proposals to the payers
and really try to make up roomwhere their rates are lower in
certain service lines,and maybe they dial back their rate
ask on the serviceswhere they're already at market or above.
(46:55):
And Beth, don't you think that's goingto become more and more valuable insight
now that we're really getting intothat age of site neutrality
and so many service lines being impactedby that lower reimbursement?
Yeah, absolutely.
I mean, having optics intothat is important.
We have clients that reallynot only want to benchmark themselves
(47:16):
hospital-to-hospital,but they want to see how do my rates align
for other provider typesthat are freestanding sites of service,
to have a better ideaof really what the patient is seeing
in terms of price in hospitalversus freestanding side of service.
Yeah, I agree, Alicia.
Anything here as we wrap up?
(47:38):
What lessons
have you learned from helping providersimprove their managed care contracts?
I think a
couple of takeaways that we have is,to Beth’s point,
it really allows you to benchmarkagainst your peer from a reimbursement
perspective, to see where you haveopportunity to improve those negotiations
and those reimbursement rateswhile trying to keep the ones
(47:58):
where you're ahead of the gamein line and static.
But from a price perspectiveto the consumer,
it also allows us to ensurethat we're maximizing our contracts
and not having lesser than concerns,because we are able to see
what those reimbursements are and setour defensible consumer price strategy.
Lastly, it allows us to also complywith the No Surprise Act
(48:22):
and be able to look at those shoppableservices and ensure that we are
providing quality data to our patientsas they think through
what their financial implicationsare, all in the world of transparency.
Well, Beth and Alicia,
I really appreciate, you guys going through my questions here
around, you know, these new pricetransparency requirements
(48:44):
and where we're heading as far as a healthcare ecosystem.
I know you guys have boots-on-the-groundexperience working with your clients
and are able to really guide themthrough this process by laser
focusing on these new requirementsand how they can help providers
and help themprepare for these conversations,
not just with managed care payers, right,but also with the public,
(49:06):
with the news outlets, with press, kind of that defensible
pricing that makes sense to the consumerand educating them on that.
So, thank you for sharing that today.
Let's turn this back over to Chad.
I want to thank Beth, Alicia
and Shawn for joining this episodeand sharing their insights.
I also want to thank our listenersfor tuning in and following
(49:27):
Achieving Healthwherever you listen to podcasts.
If you want to learn more about the topicswe discuss here,
be sure to check out the show notesfor related content and information
about how to get in touch with meand the team at Forvis Mazars.
Finally, I want to give you a heads upthat we are planning some exciting changes
to the podcast in the new year,
and we'll be sharing more detailsin two weeks on the next episode.
(49:49):
I hope you'll join methen for Achieving Health.
You can follow Achieving Healthon your favorite podcast platform or visit
forvismazars.us/AchievingHealthPodcastto learn more.
New episodes are released the firstand third Wednesday of each month.
Achieving Health
is produced by Forvis Mazars LLP,an independent member
(50:11):
of Forvis Mazars Global, a leading globalprofessional services network.
Ranked among the largest publicaccounting firms in the United States,
the firm's 7,000 dedicated team membersprovide an Unmatched Client Experience
through the delivery of assurance, tax,and consulting services for clients
in all 50 states and internationallythrough the Global Network.
(50:32):
The information set forth in this podcastcontains
the analysis and conclusionsof the panelists based upon his, her,
or their research and analysis of industryinformation and legal authorities.
Such analysis and conclusionsshould not be deemed opinions
or conclusions by Forvis Mazarsor the panelists
as to any individual situationas situations are fact-specific.
(50:54):
The listener should performtheir own analysis and form
their own conclusionsregarding any specific situation.
Further, the panelists’ conclusionsmay be revised without notice,
with or without changes in industryinformation and legal authorities.
On today's episode of Achieving Health,
I've got the latest policy and legislativeupdates from Washington, D.C.
for the week of December 1st, 2025.
Then we'll have a conversationon new price transparency compliance
requirements, challenges,and opportunities with my Forvis Mazars
colleagues, Beth Mullins and Alicia Faust,and our guest,
Shawn Stack from the HealthcareFinancial Management Association.
(00:23):
Stay tuned.
This is Achieving Health.
A podcast from Forvis Mazars,where we delve into the topics that matter
most to healthcare organizationsacross the continuum of care.
Our goal is to help younavigate the dynamic healthcare landscape
and achieve health at your organization.
Here's your host, Chad Mulvany.
(00:48):
Welcome to Achieving Health.
I'm Chad Mulvany, director inthe Healthcare Practice at Forvis Mazars.
Thank you for joining me.
We'll begin today with our WashingtonWatch segment, where I share
updates on the most recent actionsof federal policymakers
and their anticipated impacton healthcare providers and payers.
Today's WashingtonWatch reflects information as of 10 a.m.
(01:09):
Eastern Time on Monday,December 1st, 2025.
Hope everybody had a wonderfulThanksgiving and was able
to enjoy the great carbloading with friends and family.
My comments on these discussions are basedon what's being reported by the D.C.
trade press at the time of recording,mixed with a lot of judgment
about where things may gobased on my experience in D.C.
(01:31):
So, today's remarks reflect informationas of this moment and will change.
As far as our agenda is concerned,on November 21st, CMS
released its calendar year 2026 OutpatientPerspective Payment System final rule.
CMS estimates that before the recoupmentrelated to the 340B separately
payable Part B drug settlement,changes in the rule will increase
(01:54):
OPPS paymentsby $1.77 billion in calendar year 2026,
excluding changes in enrollmentcase mix in utilization.
For providerssubject to it, the 340B remedy offset
is estimated to reduce paymentsby $270 million,
which was reduced from the proposed impactestimate of $1.1 billion.
(02:17):
So that's a huge, if temporary, win.
We'll also cover a couple of the other keyprovisions in the rule in the segment.
We'll also get into President Trumpteasing a healthcare plan.
It was reported last weekthat President Trump
would announce a hybrid healthcare planto address affordability issues.
However, the anticipated healthcare planannouncement was delayed
(02:41):
if not kiboshed, amid confusionand pushback amongst Republicans.
We'll cover what was reportedly in itand provide some thoughts on where,
with not many legislating daysleft to go before
premium year starts,how affordability efforts may shake out.
CMS also issued
preliminary guidanceon a couple of One Big Beautiful
(03:04):
Bill Actprovisions related to provider taxes.
And so, on November 17th,there was preliminary guidance
clarifying the definitions of enactedand imposed
for applying new indirecthold harmless thresholds
and also outlining a transition periodfor noncompliant taxes.
While the guidance isn't good,it was certainly about what was expected.
(03:28):
And then finally,right before Thanksgiving,
we got the Medicare Advantageproposed rule.
And so on Tuesday the 25th, CMS releasedits proposed rule for contract
year 2027 that would revisethe Medicare Advantage program.
The main update init is related to the star ratings process.
There are also some changesthat will streamline enrollment processes
(03:49):
and codify provisionsfrom the Inflation Reduction Act of 2022.
So, with that, let's get into it.
In terms of the OPPS final rule,beyond the payment update and recoupment
related to 340B, CMS finalizesfielding a drug cost acquisition survey.
It implements site-neutral payments
for drug infusionservices in excepted off campus HOPDs.
(04:12):
It also modifies price transparencyrequirements and phases out the inpatient
only list while expanding the ASCcovered procedures list.
And, just a note on price transparency,I'm going to defer to my friends Beth,
Alicia, and Shawn to cover this detailin the second portion of this episode.
Certainly, a great conversation
(04:33):
and if you were tempted to drop offafter Washington Watch,
I'd encourage you to stick aroundas they deliver the goods and then some.
Again, what I will sayabout what I will cover on
OPPS, please note that it's not intendedto be an exhaustive discussion,
but just kind of cover some of the keythings quickly at a very high level.
In terms of the paymentupdate, CMS was on brand
(04:54):
with a market basket updatethat was less than input price inflation.
And so the net market basketupdate was 2.6%,
which was 3.3% gross reducedby the mandated 7/10 percent productivity
adjustment for hospitals meetingoutpatient quality reporting requirements.
This was increased from 2.4% proposed,and not a surprise
(05:15):
given that the OPPS market basketupdate, by statute,
has to follow the IPPSfinal rule market basket update.
Afterbudget neutrality and other adjustments,
the resulting OPPS conversionfactor is $91.41, or $91.415.
As proposed, it was $91.747,
(05:38):
and that's before the 340B recoupment.
Despite the increased net market basketupdate, the decrease in the area wage
index budget neutrality adjustmentfrom proposed 1.0116
to final .9990 drove
the reductionin the OPPS conversion factor.
And then for those hospitals subjectto the half a percentage point 340B
(06:02):
remedy offset,which was decreased from 2%,
the final rule conversionfactor lands at $90.96, or $90.967,
and certainlythat was increased from $89.958,
which works outto a little more than a 2% increase,
net of all adjustments for those hospitalsmeeting quality reporting requirements.
(06:24):
As I didmention, CMS did not finalize its proposal
to increase recoupment of fundsrelated to the overturned 340B separately
payable Part B drug policy at 2%.
Instead, recoupment will beginon January 1st at the previously finalized
rate of a half a percentage pointand will impact services
with status indicators of J1, J2,P, Q1, Q2, Q3,
(06:48):
R, S, S1, T, U, V.
Recoupment does not apply to providersthat began billing
Medicare under OPPSafter January 1st, 2018.
The final rule also notes that CMSanticipates implementing a larger percent
reduction, such as the 2% reductionor other reduction beginning in 2027.
(07:10):
So, what CMS is suggesting here
is that we may have temporarilydodged a much bigger cut.
The rule also finalized the proposalfor site neutral payment
for drug administration services,provided in accepted HOPDs,
and so beginning in calendar year 2026,
CMS will pay for drug administrationservices provided in those accepted
(07:32):
off-campus HOPDs,so those billing with the PO modifier
at the physician fee schedule equivalent,which is 40% of the applicable APC rate.
The policy will only apply to APCs 5691
through 5694,and does not apply to the drugs
that are administered;it's just the code for administration.
(07:54):
The agency estimates in 2026it will save $290 million.
$220 million of that is saved by CMS,$70 million of
that is saved by beneficiaries.
And like the site-neutral clinic visitpolicy, CMS exempts
sole community hospitals from this change.
CMS applies
this policy changein a non-budget-neutral manner.
(08:14):
It justifies this action as a quoteunquote “volume control method”
and cites the growth in spending and drugadministration services
provided in accepted OPDsas the rationale.
It's worth noting that CMS usedthe same justification when it applied
site neutral payments to clinic visitsprovided in accepted off-campus HOPDs.
While hospitals challenged
(08:35):
the clinic visit policy in court,it was upheld by a federal appeals court,
and the Supreme Courtdeclined to hear the appeal.
However, that ruling occurred priorto the Supreme Court's decision
in Loper Bright,
which overturned the legalChevron doctrine, which required courts
to defer to federal agenciesreasonable interpretations
of ambiguous statutes they administer,which may create an opportunity
(08:57):
for a legal challenge to this policy.
CMS, also in the proposed rule, requestedfeedback on expanding site-neutral clinic
visit policy to apply to clinic servicesprovided in on-campus HOPDs.
While CMS did not providea summary of those comments, it notes
it received a range of commentsrelated to expanding site-neutral payments
(09:18):
and those comments touched on on-campusclinic visits,
imaging services without contrast,and off-campus provider-based departments
and other services that it contendsto consider in future rulemaking.
It also sought feedbackfor developing a systemic process
for identifying ambulatory servicesat risk of being shifted
to more expensive, hospital-based settingsdue to financial incentives.
(09:41):
Similarly, like the questionabout extending the policy to on-campus
clinic visits,
it did not summarize these comments,but notes it received
43 pieces of feedback and may take theminto consideration in future rulemaking.
CMS also
finalized the timelinefor its outpatient drug pricing survey,
and so in response to President Trump's
(10:02):
executive order related to drug pricing,CMS will field
a drug cost acquisition surveyfor covered hospital outpatient drugs.
Based on the final rule, the agency willfield the survey in early 2026.
Hospitals will have 90 days to respond,so the survey can be completed
in time for the resultsto inform the 2027 OPPS proposed rule.
(10:24):
In addition to drug acquisition prices,the survey will require hospitals
to report all discounts, rebates,and other price concessions
that are provided,including the 340B discounts.
It's likely the results of the surveywill be used to reprise a reduction
in payment for separately payable PartB drugs acquired under the 340B program.
(10:44):
Given there were response rate issueswhen the prior Trump administration
attempted to field a similar surveyin spring of 2020,
the proposed rule also consideredapproaches to account for non-responses
to ensure the data set providesa large enough sample size
to be statistically reliableand meet statutory requirements.
(11:05):
Based on this commentaryand responses to comments,
CMS may assume that if a hospitaldoes not respond to the survey,
its outpatientdrug costs are not significant.
As a result, it discussedassigning these hospitals to the lowest
reported acquisition costsfor its peer group in the proposed rule.
The proposed rule also notedthat CMS may consider expanding packaging
in some instances,
(11:26):
as low response rates might indicateinsignificant outpatient drug costs.
The final rule also clarifiesthat CMS has made no decision on how,
if at all,it will account for non-responses and
any policies related to non-responseswill be included in future rulemaking
after CMS has had an opportunityto analyze the data.
In terms of phasing outthe inpatient-only list, as proposed
(11:50):
beginning in calendar year2026, CMS will phase out the inpatient
only list over three years,starting with 285 CPT codes
that are for mostly musculoskeletalservices.
The servicesCMS removes are listed in table
119, page 888 of the display copy.
(12:10):
Correspondingly, CMS creates a seven-levelmusculoskeletal procedure APC,
to which it will assignprocedures removed from the list
based on applicable estimated cost.
CMS will complete this phaseoutby calendar year 2029.
CMS will continue exempting proceduresthat have been removed from the IPO list
for medical review activities to assesscompliance with the two midnight rule,
(12:34):
until the Secretary determinesthat the service or procedure
is more commonly performed in the Medicarepopulation in the outpatient setting.
It's also important to remember
that Medicare Advantage plansshould also be adhering to this guidance.
In terms of the changes to the AIC coveredprocedure list, the final rule expands
the AIC covered procedure listby 560 services.
(12:56):
So, this is 289 procedures in general,and then includes an additional 271
that were removedfrom the inpatient-only list.
The list of proceduresCMS adds are included
in tables 131 and 132in the display version of the final rule,
and so these begin on page 1068.
(13:18):
Final rulealso includes a requirement for hospitals
to report their Medicare Advantagenegotiated rates,
with the idea that these will be usedin calculating MS-DRG rates in the future.
And so, for cost reporting periodsending on or after January 1st, 2026,
(13:38):
CMS requires hospitals to include,in their Medicare cost reports,
the median of their negotiated MedicareAdvantage rates for all plans.
This data would comefrom the most recent version
of its price transparency machinereadable file.
Critical access hospitals are excludedfrom this requirement.
Instructions for reporting this dataon the cost report are discussed
(14:01):
in an information collection request, andthat will be included in the show notes.
CMS also intends to use this datafor setting MS-DRG
weights effectivefor Fed fiscal year 2029.
The agency believesthere is a need to reduce reliance
on hospital chargemastersand develop market-based approaches
(14:21):
to establishing payment ratesunder the Medicare Fee-for-Service system.
The prior Trump administration
also included this policy in the 2021 IPPSfinal rule,
which was repealed by the Bidenadministration in the 2022 IPPS rule.
Shifting gears,
President Trump on November 23rd
teased a health plan to addressaffordability issues.
(14:44):
It was reported that the presidentwould announce a hybrid health plan
that would addresssome of the affordability issues
that could imperil Republicans’majority in the House and possibly
cost them a pickup seat opportunityin the Senate in Georgia.
However, the anticipated healthcareplan has been at least delayed,
if not had the kibosh put on it, amidconfusion and pushback from Republicans,
(15:09):
many of whom were surprisedby the proposal’s direction.
The plan was reported to includea two-year extension of the enhanced
ACA subsidies, but with income caps
and also minimum premium payments
in an option for enrollees to divert partof their tax credit into savings
accounts, either an FSA or HSA,if they chose lower cost plans.
(15:32):
While an extension of the exchangesubsidies is not popular
with most Republicans,the restrictions to subsidy eligibility
and the HSA provisions alignwith conservative priorities.
However, the president, as I mentioned,has since walked back support for a
two-year extension while leaving the dooropen for some kind of change.
Democrats reactions ranged from cautiouslyoptimistic to outright rejection.
(15:57):
Senator Jeanne Shaheen of New Hampshirewelcomed the possibility
of bipartisan talks,
noting that the president's involvementcould signal a serious negotiating effort,
especially ahead of a December voteon extending subsidies.
However, top House Democrats dismissedthe proposal as recycled Republican ideas
that fail to protect consumersfrom looming premium hikes.
(16:18):
With Republicans divided and Democratssplit between negotiation and opposition,
the president's healthcare planremains in limbo, leaving the future
of ACA subsidies and any small borehealthcare reform uncertain.
If the presidentdoes lean in and introduce
a healthcare affordability planthat includes an extension of the enhanced
exchange subsidies, it improvesthe likelihood they are extended.
(16:41):
However, I'm not sure by how much.
As I mentioned earlier,an extension of the subsidies
remains unpopular with conservativeRepublicans in the House and the Senate.
Those obviously in safe districtsor in solidly red states,
in the optics of passing a healthcare billin both the House
and Senate, supported by onlya minority of Republicans, is a bad
(17:02):
look for both Majority LeaderThune and Speaker Johnson,
who has already had enough of a challengerecently managing his caucus.
Speaking of, it's reportedthat more than 85 House Republicans
have expressed their support foran extension of the enhanced tax credits.
It's possible that enough of this cohortwill work with Democrats in the House
to file a discharge petition for a voteon the extended subsidies in that chamber.
(17:26):
If that occurs, it's likelyan extension of the enhanced subsidies
would pass the House with lessthan majority Republican support.
However, I still don't thinkthere are votes in the Senate.
Majority Leader Thune
makes good on his commitmentto hold a vote on extending the subsidies.
The other things here to watchare the potential offsets,
in additionto the existing list of potential offsets.
(17:48):
So, think PBM reform,further expansion of Medicare site-neutral
payments, the No UPCODE Act,which would impact MA plans.
It's reported that President Trump,if he had rolled out a healthcare plan,
was considering codifying his most favorednation's drug pricing policy.
While details are scarceon what this entails,
and there are two rules under reviewwith the Office of Management and Budget
(18:09):
that are likely related to it,it's possible that it would again
impact Medicare payment for PartB, separately payable drugs.
And while a straight extensionof the enhanced subsidies
without an offsetwill benefit all providers,
if the cost is offset,and that's, I'm assuming it will be,
how that occurs will determine whetheror not an extension of the subsidies
(18:30):
benefits a specific provider or not,and that will likely break down
between expansionand non-expansion states.
Moving on to OB3,
on November 17th, CMS issuedpreliminary guidance
implementing the provider tax provisionsof the One Big Beautiful Bill Act,
and this guidanceclarified definitions of enacted
(18:50):
and imposed for implying new indirecthold harmless thresholds
and also outlined a transition periodfor noncompliant taxes.
As a bit of background,under section 71115 of OB3,
new indirect hold harmless thresholds.
Effective October 1st, 2026, non-expansionstates are limited to provider taxes
(19:11):
enacted and imposed as of July 4th, 2025,
while expansion states facephasedown thresholds starting at 5.5%
in fed fiscal year 2028,declining to 3.5% by fed fiscal year 2032.
States without provider taxesas of that date are capped at 0%.
In section 71113, closing a regulatoryloophole,
(19:35):
this tightens rulesfor waiving the uniformity standard
by prohibiting tax structures that favor
or penalize providersbased on Medicaid participation or volume,
with the HHS secretary authorizedto establish a transition period of up
to three years for taxes failingto meet the new redistributive criteria.
With that out of the way, let'sget to the guidance.
So, for section 71115,the new indirect harmless thresholds,
(20:01):
CMS clarified which provider taxes fall
under the new hold harmless thresholdsby defining enacted and imposed.
A tax is considered enactedif all legislative steps were completed
and any necessary CMSwaiver was approved by January 4th, 2025,
with later adjustmentsexcluded from this definition.
(20:22):
Imposed means the state was activelycollecting revenue under that
tax structure as of July 4th, 2025and any proposals pending or submitted
after that date would not counttowards threshold calculations.
The new indirect hold harmless thresholdsestablished
by section 71115 of OB3
will take effect on October 1st, 2026.
(20:45):
In section 71117, Closing a regulatoryloophole,
CMS’ guidance under the OB3 restatesthe updated criteria for determining
whether a tax is consideredgenerally redistributive.
To help states comply, CMS set transitiondeadlines.
Managed care organization taxes must meetrequirements by the end of the state's
(21:07):
fiscal year in 2026,while all other affected taxes must comply
by the end of fiscal year in 2028,but no later than 10/1/28.
The agency emphasized that these timelinesare the minimum transition periods,
with the possibility of granting up
to three fiscal yearsdepending on final rule making.
(21:29):
The guidance isn't good, but obviouslyit's about what was expected.
Section71115 will impact counties and states
that quickly passed provider tax increasesbefore OB3’s enactment but were unable
to either one, get a waiverassociated with the tax approved by CMS
and or two, actually collect proceedsfrom the class of tax providers.
(21:52):
While
CMS will allow these new taxesthat didn't get across the finish line
to go into effect, the tax ratemust come back down by 10/1/26.
Allegedly,CMS is calling states to inform them
if they were impactedby the preliminary guidance.
CMS is not anticipated to publish a list,
so the extent of the impact is unclearand will likely remain so for a bit.
(22:13):
Given this was preliminary guidance,there is a chance that CMS reconsiders.
However, I think the odds of thisare probably long given
they knew what they were doing whenthey issued this preliminary document.
Finally, on Tuesday,November 25th, the Centers for Medicare
and Medicaid Services releaseda proposed rule for contract year 2027
that would revise the Medicare Advantageprogram, rule updates, star ratings,
(22:36):
streamlines enrollment process
and codifies provisions from the InflationReduction Act 2022.
Key changes to the star rating systeminclude removing 12 measures
that focus on administrative processeswith little variation in performance,
while adding a new depression
screening and follow upmeasure to address behavioral health gaps.
CMS also decided not to implementthe previously planned
(22:58):
Excellent Health Outcomes for All reward.
Insteadcontinuing the historical reward factor
that emphasizes consistent highperformance across all measures.
These adjustments aim to reduceadministrative burden and refocus
the program on clinical care outcomesand patient experience,
where meaningful differencesexist among plans.
The proposal also addressesenrollment and drug benefit reforms.
(23:21):
CMS plans to expand special enrollmentperiods to make it easier
for beneficiaries to switch planswhen providers leave their network,
and to codify policiesrequiring CMS approval
for certain special enrollment periodsto ensure transparency.
Additionally, CMS seeks to codifymajor Part D reforms from the Inflation
Reduction Act, such as eliminating
the coverage gap, lowering out-of-pocketthresholds, removing catastrophic
(23:45):
phasein cost sharing, and implementingthe manufacturer discount program.
Finally, CMS clarifies that cannabisproducts, illegal under federal or state
law, cannot be offered as supplementalbenefits for chronically ill enrollees,
aligning MA policies with federal lawwhile maintaining safeguards.
This concludes today's Washington Watch.
(24:05):
Up next, we'll have a conversation onprice transparency between my colleagues,
Alicia Faust and Beth Mullins,and our guest, Shawn Stack from HFMA.
I'd like to welcome our guests for today's
episode, Beth Mullins,Alicia Faust, and Shawn Stack.
Beth is a principal in the HealthcareConsulting practice at Forvis Mazars.
(24:29):
Her work focuses on managed carestrategy and contracting, including rate
benchmarking and negotiations,supported by price transparency data.
Alicia is a partner on our HealthcareConsulting team
with a focus on revenuecycle improvement and revenue integrity.
She supports clients with pricetransparency compliance and reporting,
(24:49):
and she also helps them leverage pricetransparency data
to support pricing strategyand also monitoring payment variances.
Finally, we have Shawn Stack, Directorof Perspectives and Analysis at HFMA.
Shawn is here to provide a policyperspective on price transparency
in the recently finalized 2026Outpatient Perspective Payment System rule
(25:12):
and give his thoughts on futuredevelopments in price transparency.
Thank you all for being here.
Beth, I'll turn it over to youto get the conversation started.
Thank you, Chad.
Well, the new OPPS final rule has come out
and Shawn, how did the final rule change
the price transparency requirementsthat hospitals must meet?
(25:34):
Great Beth.
Well, yeah, the final rule.
Really, I mean, CMS largely finalizedthe price transparency changes
as proposed, but added a little bitof important operational and compliance
clarifications that hospitalsneed to understand heading into 2026.
The biggest shiftis the formal replacement of the estimated
(25:56):
allowed amounts with the actual percentilebased allowed amounts.
That 10th, median, and 90th percentiles,
plus a number of data points used.
The final rule adds technical instructionslike rounding rules, requires
a 12- to 15-month lookback, and allowsequivalent remittance data sources
(26:17):
beyond the EDI 835that was in the proposed rule.
It also updates the attestation languageand finalizes that and expands it a bit.
Hospitals must testify, or attest,I should say,
not only that the MRF is accurate,
but that algorithmic based rates included
(26:40):
all components necessary for the publicto derive dollarized pricing.
CMS also finalized the requirementto encode the CEO
or senior official responsiblefor that attestation language.
The final rule also talksabout NPI requirements.
It tightens the NPI requirement.
(27:02):
Hospitals must now report type two NPIs
specifically tied to hospitaltaxonomy codes 27 and 28.
And it also continued that languagethat was in the proposed rule
around the approvedproposed 35% reduction
in civil monetary penalties for hospitalsthat waive appeal rights.
(27:24):
It did carve out any noncompliance relatedto core requirements, such as failing
to post an MRF or shoppable services,
away from that 35% reduction.
And then last but not least,the final rule did allow
a little bit of variationon effective versus enforcement dates.
(27:45):
While January 1st, 2026
remains the effective datefor the new requirements,
the agency did introducea new three-month enforcement delay
where CMS will not enforcethese provisions until April 1st of 2026,
giving hospitals a little bit of timeto operationalize those new elements.
(28:06):
Great. Thank you.
Alicia, what are you hearing from clientsabout the new requirements?
The new requirementswill continue to be burdensome
and that's kind of whatwe're hearing around the country.
The allowed amounts, as Shawn mentioned,continue to be a challenge, mostly
because all of the fields of the 835s
(28:27):
are not requiredto be filled out by the payers.
This, along with complex reimbursementmethodologies, as well as the edits
that we're not able to see, really dopresent
challenges onhow we get to the allowed amount.
The addition of the additionalNPIs is also going to be a challenge
for organizations,particularly around behavioral health,
(28:49):
which I think many of them did not includepreviously as a hospital unit.
And we're seeing that being addedaround the country.
The 90th and 10th percentile
will be a challenge as well,because we have to be able
to identify that allowed amountin those specificities.
There is some language aroundwhat rounding is going to be.
(29:12):
However, organizationsare going to have to be meticulous
in their calculationsin order to get there.
So, I think folks are nervous.
I also thinkthat they are even more nervous
about the attestationbeing at the most executive level, most
seniorexecutive levels of their organizations,
which is more in linewith what we see on the cost report side.
(29:35):
Great. Thanks, Alicia.
Shawn, what are you hearing?
Yeah.
So, Beth, very similarto what Alicia's hearing.
On a general level, I think folks rightnow are still processing the rule, right?
They're still analyzingwhat these impacts are going to be.
I think timelines for complianceare extremely tight,
even given that new 90-day windowfor enforcement,
(29:56):
and administrative burden will be highgiven the size of these files.
Many organizationswere set to refresh their MRFs in January
based on that annual update requirement,
and then they immediatelyhave to implement new fields
and meet the updatedcompliance requirements by April 1st.
So that's going to be a heavy lift.
But I think once providers really diginto the attestation language
(30:20):
that Alicia talked aboutin that final rule and recognize
how broadly the operational requirementsapply across multiple scenarios,
I expect the angst to ramp up quickly,and I think
we're all going to be getting callsfrom our members and clients.
Alicia, just in terms of compliance,are there
some of the componentsthat are more concerning than others,
(30:43):
just in terms of meeting that compliancein that time frame?
Yes. I think the allowed amount isdefinitely the highest concern for folks.
Most hospitals continue to strugglewith just getting their contracts
from their payers to be able to meetwhat was historically
the minimal requirementfrom an allowed amount.
They have to nowgo back to using the 835s and calculate
(31:06):
at the additional percentileswill create additional work
for most organizationsthat really don't have the sophistication
in order to read those 835sbeyond what they use for charge posting.
In addition to that,while the NPI reconciliations
are not complex,it is going to take additional time
for them to get that data in their MRFs,and then everything that they do from
(31:31):
that perspective will have to also flowto their shoppable services.
So, as organizations are looking to comply
with this review requirement, it'snot only on the MRF,
but also on the shoppable servicesfor both.
So, Shawn,if you're looking into your crystal ball,
where do you think the administration andCMS will go next on price transparency?
(31:56):
Next on price transparency.
Oh, boy.
Well, my crystal ball basically
shattered the day the OPPS proposedrule dropped, so that's out the window.
So, that tells youhow unpredictable things have been.
But if I had to put money on what's nextin the regulatory
laser beam line up, it'sno surprise act enforcement, right?
(32:18):
I think shoppable services and priceestimator tools
are of high focus by the administrationand their stakeholders.
The advanced EOB and all-inclusive good
faith estimates,are certainly going to be next.
And a pretty cleardrift toward exact pricing,
especially for shoppable services.
(32:38):
So, I think there's going to be someheavy lifts coming from the administration
and from the agencies.
So, I think we should buckle up,or at least
make sure you rest up over the holidaybreak.
Got it.
So, Shawn, what does this meanfor hospitals and health systems?
I mean,
you can see the administrationand its advisors
starting to show more interest in holdingpayers accountable for TIC files,
(33:04):
especially nowthat they're trying to line up hospital
files against those payer filesto judge accuracy and usefulness.
But I'm not overly optimisticthat federal oversight of payer
TIC filescompliance is going to gain much traction.
The audit authority is murky.
And the question is,is it state or federal?
(33:24):
It's previouslybeen left in the state's hands
and even the federal contractordoesn't really have the bandwidth
for large scaleTIC audits based on what I'm hearing.
So, for now,I think the scrutiny is going to stay
focused on hospitals and providersfor the foreseeable future.
That's just my two cents.
So, I think hospitals are going to have tobalance what is most,
(33:47):
you know,what are those items that they can get
as compliant as possiblebased on these very murky directives
from the administrationand from the agencies.
So, Alicia, just in terms of wherewe think the administration may be going,
what do you think it means for hospitalsand health systems from your perspective?
(34:09):
So, I agree with Shawn.
I don't think that the administrationhas the ability to do what I think
they ultimately want to do,whether we're 12 months or 24 months away
from it,is really reconciling these two files.
So, the payer fileshistorically have required NPI
so that they could clearly identifythe hospital and plan
(34:31):
associated with that reimbursed amount,or the allowed amount.
The hospitals did not require that.
This new directive that requires hospitalsto publish their NPI makes it
a little bit easier for the administrationto reconcile those two data sets.
To my earlier comment,is it going to become
he said she said ofwho published the right rates?
(34:54):
Is it the hospital file that's correct,or is it the payer file that's correct?
And what does CMS plan to dowith this information?
In the future,
what we're talking to our clientsabout is, although they're probably
several months away from that auditprogram, organizations,
hospitals, and health systemsneed to start preparing for it now.
(35:15):
So while in the pastI think they kind of skirted by
still using some estimated amount,still potentially omitting
some pretty significant reimbursementby payers that they've negotiated with,
all of that comes to a haltbecause the cosmetic audit
is going to come to an end
and an actual audit of the allowed amountsis going to start to be enforced.
(35:38):
Yeah, that's that's a good point, Alicia.
And I've been hearing from my sourcesat CMS and in the agencies
that there's a lot, there's a great dealof talk ramping up around desktop audits.
And of course, we knowthat means looking at payer addendums,
contract addendums and things like that.
So yeah, I agree with you 100%.
Okay, Beth, I've been in the hotseat here for too long;
(35:59):
let's see what you have for us.
And I say thatbecause I think most listeners who know
both of us know you're smarter than meanyway.
So, I want to pull youinto this conversation
and flip the table here a little bit.
So, what opportunities do hospitalshave to use price transparency data
for market assessment and items?
(36:21):
Yeah, that's a good question, John.
Hospitals are and should continueto use the price transparency data
to benchmark their negotiated ratewith peer hospitals in their states.
The payers are using this datato leverage lower rates from hospitals.
So, in many casesthe payers are cherry picking rates
to their advantage during contractnegotiations with hospitals.
(36:44):
So, the hospitals really doneed to be aware
of how their pricing,their negotiated rates, align
with other hospitals in their communitiesand their states
in order to really maximizetheir opportunities
and manage their riskswith their negotiations.
Great.
Alicia, any thoughts here on this topic?
(37:05):
Absolutely.
So that kind of hit the nail on the headthat we should be using this data
to help us negotiate our contracts,but part of what we also see hospitals
and health systems using this data foris for their own market position
benchmarking on howthey're actually charging the patients
and the prices that they are chargingto patients specifically.
(37:27):
What they need to be doingis really looking to understand
from those contract amounts, dothey have lesser than language,
and are they leaving dollars on the tablebecause their prices
top line tothe consumer is not appropriate?
So, we have been using this, in tandemwith Beth,
to look at the top line to ensurethat we're maximizing our contracts.
(37:49):
And then Beth and her team
use it to help negotiate even better ratesthan what we already have.
So, I know youguys have been having these conversations
and doing this workwith a lot of your clients.
Can you give me a granular exampleof how this knowledge
has helped inform managed carenegotiating strategy?
Beth, do you want to go first,
since I know you're working really closelywith your clients on this?
(38:11):
So, we've worked with numerous hospitalson rate
benchmarking analyses, and in many cases
it highlighted tremendousfinancial opportunities for the hospitals.
It's really very compellingactionable data
and the hospitals were ableto use that data
in that analysis to renegotiatetheir rates to better align with peers.
(38:33):
And significant financial upsideand opportunity for those hospitals
that were very knowledgeable abouthow their pricing compared to their peers.
Great point. Alicia?
Yes. Similarly,so when we look at the actual
reimbursements across the table,it highlighted for us the disparate
negotiating tactics
(38:53):
that the payers have been usingacross the country for a very long time.
So, your reimbursement withinyour organization was only as good as
the person sitting across from the payerwhen that negotiation was taking place.
Historically,we did not have access to this
information, and the access we didhave was very, very costly.
(39:14):
For the first time, we actually haveFreedom of Information Act.
This information is public information.
We are now able to understandour organization compared to our peers
that are right down the street,the peers that are in our city.
And then from a national perspective,even though the cost of care
really should be levelset across the country.
(39:35):
But Alicia, don't plans have access
to the same data and aren'tthey using it as well?
They are.
And unfortunately for us,they've been using this data
for a longer period of time purelybecause they had their own data
to manipulate and really identify
based on what they've negotiatedwith individual hospitals.
(39:55):
So previously they had access to their ownnegotiating rates
and were using that in order to negotiatewith hospitals.
This basically opened the field to thembecause now they have access
to their peers.
So United has access to Aetna.
Aetna has access to Blue Cross.
Blue Cross has access to Humana.
What it did is itgave them even more information
(40:18):
that they historicallyhad beyond their own negotiating.
And yes, they are accessing it.
They've been using it for a long time.
So they know how to access it.
They still have a lot of the work to dothat we're doing on the hospital side
in order to make that data usable,but they are definitely leveraging it
in their current negotiationsand probably future negotiations.
(40:39):
So, it seems like the hospital’sDavid, in this scenario,
and the payer’skind of a Goliath scenario here.
Sounds like
this price
transparency data is maybe giving Davidsome steroids.
Beth,are you seeing that in your negotiations
with hospitals and managed careagreements on behalf of hospitals?
(40:59):
Are you seeing this data greatly helpand kind of boost
the clarity that the providersare able to take into those conversations?
Yeah, absolutely.
Certainly, the hospitals,if they have done their research
and understand where they arefrom a pricing perspective versus
their peers, thatit certainly gives them actionable data
and then to know where to pushon those rates.
(41:22):
And, you know,we negotiate managed care agreements
on behalf of hospitals every dayand we're seeing the payers
now armed with this information,they're using it to try to get hospitals
to take decreases or minimize increases,like I mentioned before.
With the cherry picking of the data,the payers are,
you know, picking different piecesof the rates to try to force the hospital
(41:45):
to take a reduction in certain areas.
Which is why it's more importantto do that overall assessment
where your pricing comparesto a rate benchmarking exercise.
So, you know, in totality,how your rates align
not just at the individual codelevel or service line level.
And so, in most cases,we're able to use those analyzes
that we're doing on rate benchmarkingto counter the payers information
(42:09):
with more precise datathat we have access to.
So, Beth, I'm hearing you're right.
You're kind of saying,you know, even if you're a provider
or a hospital in a region where you thinkyou're getting fairly fair prices,
this data is just as important for youbecause you need to go into these
negotiationsvery well prepared as you always have.
(42:32):
But this gives you more insightinto more defensive strategy
and not taking reductions in payments,right?
Yes, we have quite a few clientswhere the benchmarking analysis showed
they were at top of the marketin terms of their rates.
So, it really then became importantfor them to ensure
(42:52):
that their rates align from payer to payerso that there's parity in their pricing.
So that at the top of the market,at least, the payer A
is competitive with payerB, if that makes sense.
In terms of, and it dials into thatdefensive strategy, is
how do we justify pricing andthat articulating that defensible pricing.
(43:15):
Great.
Yeah.
Because keeping in mind that the value ofhealthcare is not just pricing, right?
It's clinical outcomes.
It's length of stay, it's readmissionrates.
It's everything that goes into this.
So yeah, that data,all this data together is what I think
is what you guys are sayingis, it really helps prepare
those robust conversationswhen managed care contracts are due.
(43:37):
What are some of the challenges of workingwith hospital price transparency data
and the health plan transparencyin the TIC files?
Alicia?
There are several challengesworking with those files.
I'll take them independent of each other,but on the hospital side,
the files continue to be inconsistentin what they're reporting.
(43:57):
They continue to be noncompliantwith all of the components that they need.
Many organizations reallyare still not reporting all of the payers
that they have contracts with, simplybecause they don't have access
to the fee schedulesthat are required in order to publish.
While CMS has standardizedthe template, that's about it.
The underlying data still is very,
(44:20):
very questionablefor many hospitals across the country.
On the health plan side,while I think the schema came out
and was a little more consistent,the amount of data that they flooded
the market with is unsurmountable.
And so, folksare having to take a lot of time
to kind of sift through that,because we want to ensure
that we're comparing apples to applesand not apples to oranges.
(44:43):
So, if you have the wrong planselected on the payer side,
compared to the hospital side,you could be misrepresenting what
that patient amount from a price, as well
as from a reimbursement to the hospitalmay really be.
So, it's really looking at those filesindependently, really understanding
what is being publishedin order to make it usable
(45:06):
and presentable for your organization.
And then, Beth, what are you seeingas some of the challenges?
Well, when using the data for ratebenchmarking purposes,
we typically utilize the payer pricetransparency files.
We find them to be more consistentand reliable than the hospital files.
However,those files are terabytes of data,
(45:28):
and they're quite largeand difficult to navigate.
So, they really do require
expertise and experience to garnerthe data required for benchmarking.
Interesting.
And what lessonsyou guys, just wrapping up here
kind of, what lessonshave you learned from helping providers
(45:49):
improve their managed care contractsthat you think
may be under appreciated by,you know, our listeners?
What are those key opportunitiesor those a-ha moments
that you guyshave had going through this process
because you spent so much timein this area?
What are kind of those pointsthat you want to get across?
Beth, I'll let you go first.
(46:09):
Well, Shawn, the data not only allowshospitals to see how their rates compare
on an aggregate basis, but they also allowbenchmarking at the service line level.
This really allows hospitalsto better develop their rate proposals
to payers to focus on service lineswhere there is a rate gap.
So, for example, the rate benchmarkinganalyses will show them for inpatient
(46:32):
services, how their rates align,how their emergency room rates align,
surgery, all different service level information.
So, it really allows themto tailor their proposals to the payers
and really try to make up roomwhere their rates are lower in
certain service lines,and maybe they dial back their rate
ask on the serviceswhere they're already at market or above.
(46:55):
And Beth, don't you think that's goingto become more and more valuable insight
now that we're really getting intothat age of site neutrality
and so many service lines being impactedby that lower reimbursement?
Yeah, absolutely.
I mean, having optics intothat is important.
We have clients that reallynot only want to benchmark themselves
(47:16):
hospital-to-hospital,but they want to see how do my rates align
for other provider typesthat are freestanding sites of service,
to have a better ideaof really what the patient is seeing
in terms of price in hospitalversus freestanding side of service.
Yeah, I agree, Alicia.
Anything here as we wrap up?
(47:38):
What lessons
have you learned from helping providersimprove their managed care contracts?
I think a
couple of takeaways that we have is,to Beth’s point,
it really allows you to benchmarkagainst your peer from a reimbursement
perspective, to see where you haveopportunity to improve those negotiations
and those reimbursement rateswhile trying to keep the ones
(47:58):
where you're ahead of the gamein line and static.
But from a price perspectiveto the consumer,
it also allows us to ensurethat we're maximizing our contracts
and not having lesser than concerns,because we are able to see
what those reimbursements are and setour defensible consumer price strategy.
Lastly, it allows us to also complywith the No Surprise Act
(48:22):
and be able to look at those shoppableservices and ensure that we are
providing quality data to our patientsas they think through
what their financial implicationsare, all in the world of transparency.
Well, Beth and Alicia,
I really appreciate, you guys going through my questions here
around, you know, these new pricetransparency requirements
(48:44):
and where we're heading as far as a healthcare ecosystem.
I know you guys have boots-on-the-groundexperience working with your clients
and are able to really guide themthrough this process by laser
focusing on these new requirementsand how they can help providers
and help themprepare for these conversations,
not just with managed care payers, right,but also with the public,
(49:06):
with the news outlets, with press, kind of that defensible
pricing that makes sense to the consumerand educating them on that.
So, thank you for sharing that today.
Let's turn this back over to Chad.
I want to thank Beth, Alicia
and Shawn for joining this episodeand sharing their insights.
I also want to thank our listenersfor tuning in and following
(49:27):
Achieving Healthwherever you listen to podcasts.
If you want to learn more about the topicswe discuss here,
be sure to check out the show notesfor related content and information
about how to get in touch with meand the team at Forvis Mazars.
Finally, I want to give you a heads upthat we are planning some exciting changes
to the podcast in the new year,
and we'll be sharing more detailsin two weeks on the next episode.
(49:49):
I hope you'll join methen for Achieving Health.
You can follow Achieving Healthon your favorite podcast platform or visit
forvismazars.us/AchievingHealthPodcastto learn more.
New episodes are released the firstand third Wednesday of each month.
Achieving Health
is produced by Forvis Mazars LLP,an independent member
(50:11):
of Forvis Mazars Global, a leading globalprofessional services network.
Ranked among the largest publicaccounting firms in the United States,
the firm's 7,000 dedicated team membersprovide an Unmatched Client Experience
through the delivery of assurance, tax,and consulting services for clients
in all 50 states and internationallythrough the Global Network.
(50:32):
The information set forth in this podcastcontains
the analysis and conclusionsof the panelists based upon his, her,
or their research and analysis of industryinformation and legal authorities.
Such analysis and conclusionsshould not be deemed opinions
or conclusions by Forvis Mazarsor the panelists
as to any individual situationas situations are fact-specific.
(50:54):
The listener should performtheir own analysis and form
their own conclusionsregarding any specific situation.
Further, the panelists’ conclusionsmay be revised without notice,
with or without changes in industryinformation and legal authorities.
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