Published: Mar. 24, 2023

A bill that Colorado hospitals say could upset their financial systems and services made it through its first committee hearing at the state Legislature on Friday.

In an 8-3 vote in the House Health and Insurance Committee, lawmakers included in their approval a set of proposed amendments to House Bill 23-1215, which originally sought to prevent hospitals and health systems from charging facility fees for outpatient and other services that can be treated outside of a hospital, and for telehealth services.

The changes made exceptions to the legislation for some institutions, exempting rural hospitals and “sole community hospitals.” That includes Denver Health, the state’s primary safety net institution, whichasked lawmakers earlier this session to fast-track funding to stay afloat after nearly $35 million in losses last year.

The amendments also reduced the scope of the limitations on fees to primary care, preventative services and telehealth services, leaving hospitals free to bill facility fees for outpatient services. Many argued those services are their primary source of revenue.

While the changes will result in a much softer financial impact, UCHealth spokesperson Dan Weaver said ahead of the hearing that it still makes for a bad policy.

“We still think it could force some clinics to close and patients could lose the care they need,” Weaver said.

That’s because many of the state’s hospitals use facility fees to broadly pay for all of the support staff necessary to run a clinic: lab technicians, medical records, IT support, cleaning staff, security and more, according to the Colorado Hospital Association.

Ahead of the hearing, CHA spokesperson Julie Lonborg said in an emailed statement that even if the amendments were to come through, the bill would still harm access to care — “especially essential primary and preventive care that is helping Coloradans stay healthier and OUT of the hospital,” she said. “It will also have a detrimental impact on access to specialty care through telehealth, which many Coloradans —especially in rural parts of the state — have come to depend on.”

The bill’s sponsors disagree. They argue large hospitals that own freestanding clinics and other providers are charging facility fees more often, without any transparency about why those fees vary by place or service.

“Patients all across Colorado are getting hit with unexpected fees up to and sometimes over a thousand dollars with no clear explanation and no recourse after they’ve already paid for medical services, and these fees often aren’t covered by insurance,” said Rep. Emily Sirota (D-Denver), in a statement.

Lawmakers also included an amendment in the bill that mandates a third-party study to be commissioned by the attorney general about “where, when, and how facility fees are being charged.”

“We have been working with hospitals to address concerns since before the bill was introduced in February,” said Isabel Cruz, policy director at the Colorado Consumer Health Initiative, in a statement. “With the proposed changes, we have emphasized consumer protections and included provisions that are common sense. Why should a patient get a bill for a service they thought they could count on to be free?”

Weaver said he isn’t opposed to a transparency report, but he said it is “interesting” that lawmakers are seeking a report to help them better understand a fee structure that they would also end for primary care and telehealth.

Weaver gave the example of nurse lactation experts as a service that could suffer under the new legislation. Because those experts are not doctors, those virtual appointments often bill only for a facility fee to pay for consultants’ time, Weaver said. He said it’s a similar situation for a virtual behavioral health service catered to veterans across the state.

Supporters of the bill, which has backing from a large swath of local advocacy organizations, say too many Coloradans are struggling to pay their bills because of the rising costs of health care. Coloradans who have had negative experiences with facility fees have also spoken out in favor of the bill, describing facility fees of up to $2,500 that they were expected to pay out of pocket.

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