How it works
From payer disclosure to negotiation leverage
A plain-language walkthrough for hospital executives — no data science degree required.
We pull your payer's disclosed files
Federal law requires payers to publish machine-readable files showing what they pay hospitals. These aren't estimates — they're the payer's own contracted rates. We access and parse these files for your specific payer relationships.
You don't need to provide sensitive contract terms upfront. We start with publicly mandated disclosure data.
We identify the correct pricing methodology
MRF files often display rates as if everything is fee-for-service, but the underlying pricing methodology behind a given rate may not be. Before any comparison, we decode which methodology actually applies:
Fee-for-Service (FFS)
A flat, per-service fee. MRF data is often presented this way, but it is not universal.
APC
Ambulatory Payment Classification — a bundled outpatient methodology, not FFS.
DRG / MS-DRG
The bundled inpatient methodology under CMS's Inpatient Prospective Payment System.
Case Rate
A bundled, non-FFS rate for an episode of care.
Case Rate Per Diem
A bundled, non-FFS daily rate.
Comparing an FFS-based rate to a case-rate-based rate for what looks like the same service is not apples-to-apples. Decoding the methodology behind each disclosed rate is part of what PayerParity does — it's not just file retrieval, it's methodology-aware interpretation.
We find comparable facilities paid more
Within your payer's network, we identify hospitals receiving higher reimbursement for the same code under the same pricing methodology. For inpatient stays, that means MS-DRG-to-MS-DRG comparisons under CMS's Inpatient Prospective Payment System — not CPT codes, which apply to outpatient and professional billing.
We also account for legitimate CMS payment differences
Because commercial rates are often expressed as a percentage of Medicare, and Medicare's own payment varies facility-to-facility, we net out CMS-recognized adjustors before presenting a gap as leverage:
- Wage index — local labor cost differences
- IME — indirect medical education add-ons for teaching hospitals
- DSH — disproportionate share hospital adjustments for low-income patient mix
- Outlier payments, capital adjustments, and rural or sole community hospital status
- Value-based purchasing and readmissions program modifiers
The comparison is payer-specific, code-specific, and methodology-specific. We're not showing you a national average — we're showing you what this payer already pays a facility like yours for the same type of hospital stay, priced the same way.
You get a documented negotiating position
The output is a payer-sourced case for a better contract — specific codes, specific comparable facilities, specific rate differences, all traceable to the payer's own mandated disclosure.
This isn't a modeled benchmark a payer can wave away. It's their own numbers, their own precedent, documented and ready for your next contracting conversation.
A note on terminology
Hospital inpatient stays are paid using MS-DRGcodes under CMS's Inpatient Prospective Payment System — not CPT codes, which apply to outpatient and professional physician billing. When we say “the same hospital stay,” we mean the same MS-DRG, priced under the same methodology.
See a real example in our case study →See what your payer already pays elsewhere
We'll run your facility's data against comparable in-network hospitals and show you a real, payer-sourced gap — free, as the starting point for a conversation.