What is the purpose of the Charge Description Master (CDM)?

The Charge Description Master (CDM) serves as a comprehensive list that contains pricing information for the various services, supplies, and medications provided by a healthcare facility. This tool is essential for hospitals and healthcare providers as it standardizes the charges for each service or item, ensuring consistency and accuracy in billing. The CDM facilitates the billing process by enabling the accurate capture of charges associated with patient care, which directly impacts revenue generation for the facility.

By maintaining and regularly updating the CDM, healthcare organizations can reflect changes in costs, changes in services offered, and any changes in reimbursement rates from third-party payers. This is crucial for effective revenue cycle management, ensuring that facilities are reimbursed appropriately for the services they provide while also complying with regulatory requirements. This connection between charge capture and effective billing is what underscores the significance of the CDM in the overall revenue cycle.