The Importance of a Chargemaster

As a patient receives services at a medical facility, staff record the fees on a list called a chargemaster. Chargemaster training is crucial to ensure the consistency and accuracy of this data for specific departments or services.

Hospital administrators use chargemaster data to track costs, revenue and service volume. It is vital to revenue integrity to maintain an updated and accurate file.


This large master document contains all of a patient’s billable services and items. It details the costs of procedures, supplies, prescriptions, diagnostic tests and services provided at the hospital. It also includes costs such as room fees and equipment costs.


Someone must update the file annually and whenever new services begin or current services end. In a large facility, this task is a full-time job. When hospitals increase their fees or update codes, the chargemaster must reflect the new rates.

The chargemaster coordinator or team duties include:


For each service, this list includes the following:

  • Item number assigned to the service line item
  • Procedure code
  • Item description
  • Revenue code
  • Fee for the service
  • Alternative or additional regulations as needed
  • Department number
  • General ledger number for accounting


Hospital leaders must compare their internal list of codes for billable services with those used for claims reimbursement. It is imperative to make sure these are correct. The prices are irrelevant if the codes are wrong. Revenue cycle leaders also need to ensure the descriptions are easy to understand for clinician use.


Once the codes are updated, leaders decide the fees. Each hospital determines its prices for the many services performed by its providers. It is wise to check what local competitors charge for the same service to maintain competitive and fair pricing. Each facility will have a markup formula that is best for the specific needs of its unique business.


The employees responsible for maintaining the documents must communicate with clinicians to ensure all billable services and prices are accurate. Clinicians should go over the chargemaster to identify service charges and codes that might require revision.

Updating the chargemaster is quite a time consuming and involved task. It requires investigation, research and close attention to detail to ensure correct codes, prices and charges. Failing to evaluate and revise the list regularly can lead to compliance violations, underpayments and other problems.