Why Keeping Your Chargemaster Updated Is More Important Than Ever
The charge description master – often referred to as “Chargemaster” or “CDM” – is the price list for services rendered by the healthcare provider. With the recent legislation around price transparency for healthcare providers and insurers, it is becoming increasingly important to keep your charge description master up to date.
Below are eight reasons why it’s important to maintain updated hospital chargemasters.
- Regulatory compliance: An up-to-date chargemaster ensures the hospital meets regulatory requirements, avoiding potential penalties or legal issues.
- Accurate billing: By keeping the CDM current, hospitals can ensure accurate and consistent billing for services rendered. This helps enhance transparency and build trust with patients, which ultimately improves patient satisfaction.
- Reimbursement optimization: An updated chargemaster can improve negotiations and lead to better reimbursement rates with insurance companies and government payers, positively impacting the hospital’s financial health.
- Efficient revenue cycle management: A properly maintained chargemaster helps reduce billing errors, decrease claim denials and accelerate payment collections, leading to improved hospital cash flow.
- Cost control: By understanding the true costs associated with various services and procedures, hospitals can identify opportunities for cost saving and optimize resource allocation.
- Price transparency: In recent years, there has been a growing demand for price transparency in healthcare. Maintaining the chargemaster helps hospitals provide accurate pricing information to patients, promoting transparency and empowering patients to make informed decisions about their care.
- Efficient payer negotiations: Insurance companies and other payers frequently negotiate contracts with healthcare providers. An updated chargemaster provides the hospital with accurate pricing data to support these negotiations, leading to fair agreements and better relationships with payers.
- Data integrity: The chargemaster is an essential component of a hospital’s financial and operational data. Keeping it up to date helps the hospital ensure data integrity, which is crucial for financial reporting, decision making and strategic planning.
A comprehensive review of every hospital CDM should be completed each year to address code changes, underused charges, inconsistencies between departments, incorrect UB-04 revenue codes and pricing compared to payer contracts.
With staff having to wear many hats, CDM reviews can often fall through the cracks, but the importance of maintaining your CDM is vital. Be sure your facility has reviewed its CDM goals. Then, you can develop and implement a plan to ensure both revenue and compliance with regulatory requirements.
RehabVisionshas extensive experience in chargemaster development and review for hospital therapy departments. We welcome the opportunity to discuss a partnership with your hospital. Contact us today to get the conversation started!