Chargemaster

In the United States, the chargemaster, also known as charge master, or charge description master (CDM), is a comprehensive listing of items billable to a hospital patient or a patient's health insurance provider. In practice, it usually contains highly inflated prices at several times that of actual costs to the hospital. The chargemaster typically serves as the starting point for negotiations with patients and health insurance providers of what amount of money will actually be paid to the hospital. It is described as "the central mechanism of the revenue cycle" of a hospital.

The chargemaster may be alternatively referred to as the "charge master", "hospital chargemaster", or the "charge description master" (CDM).The chargemaster is a master file built within hospital information systems, and designed to communicate (interface) with other software applications or systems to support government-mandated standard billing requirements. It contains data elements such as charge descriptions, billing codes, pricing, and many other necessary data elements. It is a comprehensive listing of items billable to a hospital patient or a patient's health insurance provider. It is described as "the central mechanism of the revenue cycle" of a hospital. Chargemasters include thousands of hospital services, medical procedures, equipment fees, drugs, supplies, and diagnostic evaluations such as imaging and blood tests. Each item in the chargemaster is assigned a unique identifier code and a set price that are used to generate patient bills. Every hospital system maintains its own chargemaster.

The procedure of developing, maintaining, and monitoring the chargemaster and its pricing scheme often necessitates multiple hospital employees working under the supervision of a "chargemaster coordinator", a "charge master manager", or others in the health care system's operations or administrative support areas frequently called a "charge master team". Ultimate responsibility for ensuring accuracy of the chargemaster rests with each hospital's chief financial officer, compliance officer, and hospital Board. Approximately forty percent of hospitals pay outside companies to help create and then adapt their chargemasters on a yearly basis. According to Essentials of Managed Health Care, as of 2012 the chargemaster file typically included between 20,000 and 50,000 price definitions. The Lewin Group analyzed utilization of the chargemaster and found that a low proportion of hospitals carried out regular reviews of their chargemaster implementation. Costs for patients maintained on the chargemaster differ greatly from hospital to hospital.

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