SB2579eng 93RD GENERAL ASSEMBLY

SB2579 Engrossed LRB093 16098 DRJ 41726 b

AN ACT concerning health facilities.

Be it enacted by the People of the State of Illinois, represented in the General Assembly:

Section 1. Short title. This Act may be cited as the Hospital Charity Assistance Act.

Section 5. Applicability.

(a) This Act does not apply to a hospital that does not charge for its services.

(b) The obligations of hospitals under this Act shall apply to services provided on or after the first day of the first month that begins at least 180 days after the effective date of this Act.

Section 10. Definitions. In this Act:

"Cost of providing services" means a hospital's published charges at the time of billing of an uninsured patient, multiplied by the hospital's most recent relationship of costs to charges taken from the most recently audited Medicare cost report.

"Department" means the Illinois Department of Public Health.

"Federal poverty level" means the poverty guidelines updated periodically in the Federal Register by the United States Department of Health and Human Services under authority of subsection (2) of Section 9902 of Title 42 of the United States Code.

"Financially qualified uninsured patient" means a patient who is uninsured, whose family income is less than 200% of the federal poverty level, and who satisfies the requirements under a hospital's charity assistance policy under Section 20 of this Act.

"Hospital" means any facility that is required to be licensed under the Hospital Licensing Act.

"Medically necessary service" means any inpatient or outpatient hospital service that is covered by and considered to be medically necessary under Title XVIII of the federal Social Security Act. Medically necessary services do not include any of the following:

(1) Non-medical services such as social, educational, and vocational services.

(2) Cosmetic surgery.

"Uninsured discount" means, with respect to medically necessary services rendered to a financially qualified uninsured patient, a discount that is applied after the hospital's charges are imposed on the patient, due to the patient's determined financial inability to pay the charges.

"Uninsured patient" means a patient who has been an Illinois resident for at least one year, who does not have third-party coverage from a health insurer, a health care service plan, Medicare, or Medicaid, and whose injury is not compensable for purposes of workers' compensation, automobile insurance, or other insurance as determined and documented by the hospital. The term does not include any patient who had an opportunity to obtain third-party coverage through his or her employer but did not obtain such coverage.

Section 15. Charity assistance policy. Every hospital must adopt a charity assistance policy specifying how the hospital will determine the financial liability for medically necessary services rendered to financially qualified uninsured patients. Every hospital must specify in its policy how the hospital will determine and apply uninsured discounts for services provided to financially qualified uninsured patients. The policy must include:

(1) Financial eligibility criteria.

(2) Responsibilities and information required of the uninsured patient.

(3) A summary of the decision-making process.

(4) A description of how the hospital will consider assets available to the uninsured patient in determining whether the uninsured patient qualifies for an uninsured discount. The following are to be considered exempt and shall not be considered in determining whether the uninsured patient qualifies for an uninsured discount:

(A) Homestead property.

(B) $2,000 for the uninsured patient, or $3,000 for the uninsured patient and one dependant residing together.

(C) $50 for each additional dependant residing in the same household.

(D) Personal effects and household goods that have a total value of less than $2,000.

(E) A wedding and engagement ring and items required due to medical or physical condition.

(F) One automobile with fair market value of $4,500 or less.

If the uninsured patient satisfies the requirements established by the hospital to qualify for an uninsured discount and the family income of the uninsured patient is equal to or less than the federal poverty level, the uninsured discount shall be 100% of the charges for the medically necessary services provided to the uninsured patient.

If the uninsured patient satisfies the requirements established by the hospital to qualify for an uninsured discount and the family income of the uninsured patient is greater than 100% of the federal poverty level, but less than 200% of the federal poverty level, the uninsured discount shall be at least equal to the difference between the charge for medically necessary services and the cost of providing services.

Section 20. Patient responsibilities.

(a) A hospital's charity assistance policy may require the cooperation of the uninsured patient, as a condition of receiving assistance. That cooperation may include, but need not be limited to, the following:

(1) The uninsured patient must cooperate with the hospital in providing information on third-party coverage. If the hospital finds that there is a reasonable basis to believe that the patient may qualify for such assistance, the patient must cooperate in applying for third-party coverage that may be available to pay for the uninsured patient's medically necessary care, including coverage from a health insurer, a health care service plan, Medicare, Medicaid, KidCare, FamilyCare, automobile insurance, worker's compensation, or other insurance.

(2) The uninsured patient must provide the hospital with financial and other information requested by the hospital to determine eligibility for charity assistance through the hospital.

(3) The uninsured patient or a person acting on his or her behalf must request assistance from the hospital.

(4) The uninsured patient who has a payment obligation to the hospital must cooperate with the hospital to establish and comply with a payment plan. The uninsured patient who enters into a payment plan with the hospital shall promptly inform the hospital of any change in circumstances that will impair his or her ability to comply with the payment plan.

(b) An uninsured patient who fails to satisfy his or her responsibilities under subsection (a) may be billed by the hospital and is subject to collection activities consistent with the hospital's billing and collection policies and practices for patients who do not qualify for assistance under its charity assistance policy.

(c) A financially qualified uninsured patient who fails to comply with a payment plan may be billed by the hospital and is subject to collection activities consistent with the hospital's billing and collection policies and practices for the portion of the bill remaining after the uninsured discount has been applied.

Section 25. Notice of policy.

(a) Notice of the hospital's charity assistance policy must be clearly and conspicuously posted in locations that are visible to the public, including, but not limited to, all of the following:

(1) The emergency department, if any.

(2) The billing office.

(3) The admissions office.

(b) Notice of the hospital's charity assistance policy must be available in brochures that are available to the public in the hospital.

(c) The following information must be included on or with the bill sent to an uninsured patient:

(1) A request that the patient inform the hospital if the patient has health insurance coverage, Medicare, Medicaid, or other insurance.

(2) A statement that if the patient does not have health insurance he or she may be eligible for Medicare, Medicaid, FamilyCare, KidCare, or the hospital's charity assistance program.

(3) A statement indicating how the patient may obtain information on how to apply for Medicare, Medicaid, FamilyCare, KidCare, and the hospital's charity assistance program.

(4) The hospital contact and phone number for financial assistance programs.

(d) The written notices required under this Section shall be available in English and any other language that is the primary language of at least 5% of the patients served by the hospital annually.

Section 30. Application forms. Every hospital must make available, upon request by a member of the public, a copy of the application used by the hospital to determine a patient's eligibility for charity assistance.

Section 35. Billing.

(a) Every hospital must make reasonable efforts to obtain from a patient or his or her representative information about whether private or public health insurance or sponsorship may fully or partially cover the charges for care rendered by the hospital to the patient, including, but not limited to, any of the following:

(1) Private health insurance.

(2) Medicare.

(3) Medicaid, FamilyCare, KidCare, or other state-funded or county-funded programs designed to provide health coverage.

(b) If a hospital bills a patient, then upon request from the patient the hospital must provide an itemized statement of charges for services rendered by the hospital within 70 days after receiving the request.

Section 40. Debt collection activities.

(a) For at least 70 days after an uninsured patient's discharge from a hospital, the hospital or its assignee or billing service shall not file a lawsuit to collect payment on the patient's bill.

(b) If an uninsured patient complies with a payment plan that has been agreed to by the hospital, the hospital shall not otherwise pursue collection action against the uninsured patient.

(c) If an uninsured patient informs the hospital that he or she has applied for health care coverage in compliance with subsection (a) of Section 20 of this Act, the hospital or its assignee or billing service shall not pursue any collection action against the uninsured patient until a decision has been made on the application for health care coverage or until there is no longer a reasonable basis to believe the patient may qualify for such coverage, whichever is sooner.

(d) If an uninsured patient has requested charity assistance from a hospital and is cooperating with the hospital under Section 20 of this Act, the hospital or its assignee or billing service shall not pursue any collection action against the uninsured patient until a determination is made on the uninsured patient's eligibility for charity assistance.

Section 45. Availability of policy. Every hospital, upon request, must provide any member of the public and the Department with a copy of its charity assistance policy.

Section 50. Enforcement.

(a) The Department shall develop and implement a complaint system through which the Department may receive complaints of violations of this Act. The Department shall establish a complaint system or utilize an existing Department complaint system. The complaint system shall include (i) a complaint verification process by which the Department determines the validity of a complaint and (ii) an opportunity for a hospital to resolve the complaint through an informal dispute resolution process.

If the complaint is not resolved informally, then the Department shall serve a notice of violation of this Act on the hospital. The notice of violation shall be in writing and shall specify the nature of the violation and the statutory provision alleged to have been violated. The notice shall inform the hospital of the action the Department may take under this Act, the amount of any financial penalty to be imposed, and the opportunity for the hospital to enter into a plan of correction. The notice shall also inform the hospital of its right to a hearing to contest the alleged violation under the Illinois Administrative Procedure Act.

(b) If the Department finds that a hospital is in violation of this Act, the hospital may submit to the Department, for the Department's approval, a plan of correction. If a hospital violates an approved plan of correction within 6 months of its submission, the Department may impose a monetary civil penalty on the hospital. For a first violation of an approved plan of correction, the Department may impose a penalty of up to $100. For a second or subsequent violation of an approved plan of correction, the Department may impose a penalty of up to $250. The total penalties imposed under this Act against a hospital in 12 month period may not exceed $5,000.

The Department may impose a civil penalty under this Section only after it provides the following to the hospital:

(1) Written notice of the alleged violation.

(2) Written notice of the hospital's right to request an administrative hearing on the question of the alleged violation.

(3) An opportunity to present evidence, orally or in writing or both, on the question of the alleged violation before an impartial hearing examiner appointed by the Director.

(4) A written decision from the Director of Public Health, based on the evidence introduced at the hearing and the hearing examiner's recommendations, finding that the hospital violated this Act and imposing the civil penalty.

The Attorney General may bring an action in the circuit court to enforce the collection of a monetary penalty imposed under this Section.

Moneys in payment of penalties imposed under this Act shall be paid to the Department and deposited into the Nursing Dedicated and Professional Fund.

(c) If the Department has a reasonable basis to believe that a hospital has engaged in a pattern of violations of this Act or has failed to adopt policies and procedures to comply with this Act, the Department may issue a written certification of the basis for that belief to the Attorney General. Upon receiving such written certification, the Attorney General may:

(1) Require the hospital to file a statement or report in writing as to all information relevant to the alleged violations.

(2) Examine under oath any person in connection with the alleged violations.

(3) Examine any record, book, document, account or paper necessary to investigate such alleged violations.

(4) Bring an action in the name of the People of the State against such hospital to restrain by preliminary or permanent injunction the use of policies or practices that violate this Act.

Section 55. Illinois Administrative Procedure Act. The Illinois Administrative Procedure Act shall apply to all administrative rules and procedures adopted by the Department under this Act.

Section 60. Administrative Review Law. The Administrative Review Law shall apply to and govern all proceedings for judicial review of final administrative decisions of the Department under this Act.

Section 65. Exemptions. The Department may grant an exemption from this Act to a hospital that demonstrates that compliance with the Act will, more likely than not, impose an undue burden on the hospital. Factors to be considered by the Department in deciding whether to grant an exemption include, but are not limited to: the financial condition of the hospital; the impact that compliance will have on the cost of services provided by the hospital; the impact that compliance will have on the quality of services provided by the hospital; and the impact that compliance will have on the community's access to health care services.

Section 70. Limitations. Nothing is this Act shall be used by any private or public third-party payer as a basis for reducing the third-party payer's rates or policies. Discounts authorized under this Act shall not be used by any private or public third-party payer to determine a hospital's usual and customary charges for any health care service. Nothing in this Act shall be construed as imposing an obligation on a hospital to provide any particular service or treatment to an uninsured patient. Nothing in this Act shall prohibit hospitals from providing discounts to patients who do not meet the criteria of a financially qualified uninsured patient under this Act. Nothing in this Act shall be construed as imposing an obligation on a hospital to file a lawsuit to collect payment on a patient's bill.

Section 75. Home rule. A home rule unit may not regulate hospitals in a manner inconsistent with the provisions of this Act. This Section is a limitation under subsection (i) of Section 6 of Article VII of the Illinois Constitution on the concurrent exercise by home rule units of powers and functions exercised by the State.

Section 95. The Hospital Licensing Act is amended by changing Section 7 as follows:

(210 ILCS 85/7) (from Ch. 111 1/2, par. 148)

Sec. 7. (a) The Director after notice and opportunity for hearing to the applicant or licensee may deny, suspend, or revoke a permit to establish a hospital or deny, suspend, or revoke a license to open, conduct, operate, and maintain a hospital in any case in which he finds that there has been a substantial failure to comply with the provisions of this Act, or the Hospital Report Card Act, or the Hospital Charity Assistance Act, or the standards, rules, and regulations established by virtue of any either of those Acts.

(b) Such notice shall be effected by registered mail or by personal service setting forth the particular reasons for the proposed action and fixing a date, not less than 15 days from the date of such mailing or service, at which time the applicant or licensee shall be given an opportunity for a hearing. Such hearing shall be conducted by the Director or by an employee of the Department designated in writing by the Director as Hearing Officer to conduct the hearing. On the basis of any such hearing, or upon default of the applicant or licensee, the Director shall make a determination specifying his findings and conclusions. In case of a denial to an applicant of a permit to establish a hospital, such determination shall specify the subsection of Section 6 under which the permit was denied and shall contain findings of fact forming the basis of such denial. A copy of such determination shall be sent by registered mail or served personally upon the applicant or licensee. The decision denying, suspending, or revoking a permit or a license shall become final 35 days after it is so mailed or served, unless the applicant or licensee, within such 35 day period, petitions for review pursuant to Section 13.

(c) The procedure governing hearings authorized by this Section shall be in accordance with rules promulgated by the Department and approved by the Hospital Licensing Board. A full and complete record shall be kept of all proceedings, including the notice of hearing, complaint, and all other documents in the nature of pleadings, written motions filed in the proceedings, and the report and orders of the Director and Hearing Officer. All testimony shall be reported but need not be transcribed unless the decision is appealed pursuant to Section 13. A copy or copies of the transcript may be obtained by any interested party on payment of the cost of preparing such copy or copies.

(d) The Director or Hearing Officer shall upon his own motion, or on the written request of any party to the proceeding, issue subpoenas requiring the attendance and the giving of testimony by witnesses, and subpoenas duces tecum requiring the production of books, papers, records, or memoranda. All subpoenas and subpoenas duces tecum issued under the terms of this Act may be served by any person of full age. The fees of witnesses for attendance and travel shall be the same as the fees of witnesses before the Circuit Court of this State, such fees to be paid when the witness is excused from further attendance. When the witness is subpoenaed at the instance of the Director, or Hearing Officer, such fees shall be paid in the same manner as other expenses of the Department, and when the witness is subpoenaed at the instance of any other party to any such proceeding the Department may require that the cost of service of the subpoena or subpoena duces tecum and the fee of the witness be borne by the party at whose instance the witness is summoned. In such case, the Department in its discretion, may require a deposit to cover the cost of such service and witness fees. A subpoena or subpoena duces tecum issued as aforesaid shall be served in the same manner as a subpoena issued out of a court.

(e) Any Circuit Court of this State upon the application of the Director, or upon the application of any other party to the proceeding, may, in its discretion, compel the attendance of witnesses, the production of books, papers, records, or memoranda and the giving of testimony before the Director or Hearing Officer conducting an investigation or holding a hearing authorized by this Act, by an attachment for contempt, or otherwise, in the same manner as production of evidence may be compelled before the court.

(f) The Director or Hearing Officer, or any party in an investigation or hearing before the Department, may cause the depositions of witnesses within the State to be taken in the manner prescribed by law for like depositions in civil actions in courts of this State, and to that end compel the attendance of witnesses and the production of books, papers, records, or memoranda.

(Source: P.A. 93-563, eff. 1-1-04.)

Section 99. Effective date. This Act takes effect upon becoming law.