Chargemaster inaccuracy used to be purely a revenue problem. As of 2026, it’s also a compliance challenge. CMS has significantly expanded what hospitals must publicly disclose about their pricing. Organizations working with an outdated chargemaster are going to leave money on the table and expose this information for anyone to see.
When considering your current pricing structures there are a number of red flags that might indicate that it’s time to evaluate your chargemaster.
This clause states that if you bill an insurance payer less than the contracted rate for that code, they are in their right to pay you that rate and do not have to notify you of the money you are leaving on the table.
Too many write-offs lead to poor gross collection rates (the amount of cash are you collecting relative to your charge price). A normal practice might collect 40-50% or even as low as the 30% range for what they’re collecting relative to their charge price and over half is often a contractual adjustment.
Patients are becoming consumers and want an accurate estimate of what they should expect to pay upfront. However, current pricing methodologies in many practices make it difficult to assist patients in this way.
Many practices still use a % of a charge or other non-defensible/rational pricing structure that is now outdated and ineffective.
A flat percent-of-Medicare markup is the most common example of this, and it’s become one of the riskier choices a practice can make. The flat-rate method survived way longer than it should have, but it’s not a sustainable option anymore.
Under CMS’s updated Hospital Price Transparency rule, hospitals must now publish actual median, 10th percentile, and 90th percentile allowed amounts, calculated directly from real remittance data, in place of the vague estimates the rule previously allowed. That requirement took effect January 1, 2026, with enforcement beginning April 1, 2026.
The numbers that used to live quietly in your chargemaster are now sitting in a standardized, machine-readable file that patients, competitors, payers, and CMS auditors can all pull and compare. An indefensible pricing method is far easier to spot, which means you can’t run the risk of creating a chargemaster that has not been benchmarked against something real.
In the past, pricing structures that couldn’t withstand scrutiny could go unnoticed or remain hidden. That’s no longer the case.
Once you have identified any outdated or ineffective pricing methodologies within your current pricing structure, it’s time to develop a mechanism to see what you should be getting paid. This can be done by evaluating fee schedules or by running through a yield report. And while there is almost no commercial payer who will pay 100% of charges, you can look at remittance payments as a percentage, and if your charge price is the insurance allowable, it is likely that you are losing money.
Next, compare your CPT codes with the payer fee schedule/current contracted rate to determine if you are underpriced and are leaving cash on the table. Then, have a mechanism that shows “what is my charged price” and “what is my contracted rate?” as well as the number of times you are billing that code with that specific contracted rate.
This practice will help you evaluate what your pricing opportunity is when creating a new chargemaster.
Begin by exporting your current chargemaster to help you see what your charged prices are. (Usually this is a pretty easy export from EHR or your practice management system.) Then, evaluate your fee schedules.
Payer contracts and fee schedules help you to comprehensively understand your contracted rates. If you do not have a copy of a payer’s current fee schedule on hand, request them from your payer.
Having copies of your contracts and fee schedules and being aware of what they entail will have a huge ripple effect that will help you determine the financial health of your practice.
Next, understand your rates to increase revenue. Once you know what your contracted rates are, you can evaluate where your current charge price is and see where the upper-bound is for your allowables (i.e. If a payer is allowing 100% of your charges but you don’t know how much more you should charge, having a fee schedule will let you know what they allow and will alert you to where you should be charging more.)
Once you have all of your contracted rates, you can use those to increase revenue through setting your prices intelligently.
While you’re establishing that baseline, you should also run your machine-readable files through CMS’s free Hospital Price Transparency Online Validator. The tool is publicly available and required. It’s also a useful gut-check step even if you’re confident your files are accurate.
It will be far cheaper for your organization to catch a simple error up front. If those errors get published on your live, public-facing files, it can result in a loss of trust and major fines.
To set a defensible chargemaster, we recommend implementing the following simple methodology that can create a dramatic impact:
First, if you have providers that are compensated at a percentage of your overall collection rate (gross collection rate is factor into provider compensation) you will have to do a bit of realignment and communicate that you are working to improve your ratio of collecting, not simply charge 30% more.
Second, if you are underpriced by decision, such as using specific underpriced procedures as a marketing tool, that’s ok! Just ensure that you are underpriced for a specific reason and you are quantifying what you are losing.
Third, if your prices are structured well, but are still high relative to the market, you either have amazing contracts (good job!), or might consider bumping against lesser-of if you have a specific growth plan for specialties or patient marketing.
The stakes around getting this right have also changed. CMS requires you to name a designated executive, CEO, CFO, or senior official. Whoever you designate to endorse your chargemaster has to personally attest that it is accurate, which forces them to put some skin in the game.
An indefensible or poorly maintained chargemaster was always a financial risk. Now, it also creates a compliance risk with a named individual’s signature and reputation attached to it.
Many organizations clung to the idea of “we’ll get to it eventually.” That was never a good position, but it is especially weak now that chargemaster data has to be public-facing. If none of your executive leaders are comfortable putting their name on your chargemaster, that tells you all you need to know about your pricing methodology.
The CMS Hospital Price Transparency Enforcement Fact Sheet reveals that the CMS nearly doubled its pace of enforcement in 2025. The CMS issued 10 civil monetary penalties to hospitals, up from just three the year before. Fines ranged from roughly $32,000 to over $300,000. A new, stricter enforcement window opened on April 1, 2026, giving CMS more room to act on the updated disclosure requirements.
Practices that treated price transparency as a someday project are often showing up on the penalty list. That’s because they fell way behind while the CMS tightened its enforcement policies. Getting your pricing methodology defensible now is the best way to avoid playing catch-up.
An annual chargemaster review used to be standard practice in the healthcare industry. It’s becoming outdated for the same reason percent-of-Medicare pricing is: the market moved faster than the review cycle. Healthcare organizations that don’t increase their review frequency will fall behind, and the revenue cycle will bear the brunt of the damage.
Now that hospital pricing data is standardized and publicly available in machine-readable format, practices are turning to software to compare their chargemaster on a rolling basis. This approach allows healthcare organizations to avoid falling behind and address drift sooner.
The advantage is timing. As HFMA has noted, CMS wants the industry to converge machine-readable file data with the estimates that practices give patients up front.
This means the data is now detailed and current enough to benchmark in real time. A practice that relies on annual reviews won’t catch underpricing or lesser-of-exposure until months of revenue have already been lost.
Rivet delivers powerful revenue tools that can reinforce your pricing methodology and protect your RCM processes. With Rivet, your healthcare organization can identify drift sooner, close the gap, and build a defensible chargemaster. Schedule a demo with Rivet.
A chargemaster, or charge description master (CDM), is the comprehensive list of prices a practice or hospital sets for its procedures, products, and services before any payer adjustments are applied.
Reviewing your organization’s chargemaster annually is not sufficient because market rates change quickly and disclosure requirements have shifted. Many practices are moving toward continuous, software-driven benchmarking instead.
A lesser-of clause is a contract provision that allows a payer to pay whichever amount is lower between your billed charge and the contracted rate. The payer is not obligated to flag the difference to you.
The current CMS Hospital Price Transparency rule applies specifically to hospitals. However, the same defensible-pricing principles benefit any practice developing payer contracts. There is also mounting pressure for broader pricing methodology transparency.
If a healthcare organization is relying on an inaccurate file, it could incur civil penalties from the CMS. While the penalty amount varies, the highest charges exceeded $300,000 for a single hospital in 2025. An executive attestation is required with every filing, which shifts the burden of accuracy solely onto the healthcare organization while raising the stakes of filing using an inaccurate machine-readable file.
A compliant chargemaster meets CMS’s disclosure requirements. A defensible one uses a rational, benchmarked methodology that can hold up against scrutiny from payers, patients, or auditors.