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CMS Issues New Guidance to Expand Healthcare Price Transparency

May 29, 2025

On May 22, 2025, the Centers for Medicare & Medicaid Services (CMS) issued new guidance reinforcing a previous executive order from February 25, 2025, titled “Making America Healthy Again by Empowering Patients with Clear, Accurate, and Actionable Healthcare Pricing Information” (the Executive Order).1 This Executive Order instructed the Departments of the Treasury, Labor, and Health and Human Services (HHS) to take significant steps to ensure patients receive accurate and standardized pricing information across hospitals and health plans.  
 
Consistent with the Executive Order, CMS has now issued guidance to ensure that hospitals “provide meaningful accurate information about their charges for health care items and services” rather than just estimates.2 CMS also released a separate request for information to collect public input on how to improve hospital compliance, enhance enforcement, and ensure the accuracy and completeness of the data shared. CMS officials have emphasized that transparency in pricing helps patients better understand what they are paying for and promotes accountability across the system.
 
The new guidance reinforces that hospitals must display actual dollar amounts — not estimates — in their files, including payer-specific negotiated charges and estimated allowed amounts derived from historical data. CMS is discontinuing the use of placeholder values such as “999999999” and expects hospitals to calculate and encode the average dollar amount the hospital has received for an item or service using electronic remittance advice transaction data from the prior 12 months.
 
CMS believes that its guidance will reduce healthcare costs, encourage competition, and provide consumers with information to make informed choices.
 
Hospitals should consider engaging legal counsel to ensure full compliance with evolving requirements. Counsel can help hospitals interpret these complex requirements, assess current practices, support data accuracy, provide strategic guidance on how to meet federal expectations, and avoid potential penalties or reputational harm stemming from noncompliance.

Footnotes

  1. Making America Healthy Again by Empowering Patients with Clear, Accurate, and Actionable Healthcare Pricing Information, Exec. Order (2025) (available at https://www.whitehouse.gov/presidential-actions/2025/02/making-america-healthy-again-by-empowering-patients-with-clear-accurate-and-actionable-healthcare-pricing-information/).

  2. Updated Hospital Price Transparency Guidance Implementing the President’s Executive Order “Making America Health Again by Empowering Patients with Clear, Accurate, and Actionable Healthcare Pricing Information”, CMS (May 22, 2025) (available at https://www.cms.gov/files/document/updated-hpt-guidance-encoding-allowed-amounts.pdf).

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