093_SB0552

 
                                     LRB093 03367 AMC 06106 b

 1        AN ACT concerning health facilities.

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

 4        Section  1.  Short  title.  This  Act may be cited as the
 5    Truth in Hospital Billing and Finances Act.

 6        Section 5.  Findings. The General Assembly finds that:
 7             (1)  The rising cost of  health  care  and  services
 8        provided  by  health care facilities is a matter of vital
 9        concern to the people of this  State  and  has  a  direct
10        relationship  to  the  ability  of  the  people to obtain
11        necessary health care.
12             (2)  The citizens of this  State  have  an  inherent
13        right  to  receive and have available to them health care
14        programs  and  services  that  are  capable  of   meeting
15        individual needs.
16             (3)  The public cannot make informed decisions about
17        personal  health care without access to information about
18        the facilities that provide it.

19        Section 10.  Purpose. It is the purpose of  this  Act  to
20    provide that the facilities and organizations covered by this
21    Act  shall  make  a  public  disclosure  of  their  financial
22    position and their policies concerning the treatment of those
23    without  full insurance and to ensure consumers timely access
24    to information  regarding  hospital  charges  and  collection
25    procedures.

26        Section  15.  Definitions.  For the purposes of this Act,
27    unless the context requires otherwise:
28        "Annual report" means an annual financial report for  the
29    health  care facility's or related organization's fiscal year
 
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 1    prepared by  an  accountant  or  the  covered  facility's  or
 2    related organization's auditor.
 3        "Bad  debt"  means charges for which payment was expected
 4    but not received.
 5        "Charity  care"  means  health  care  services   provided
 6    without  charge with no expectation of payment valued at cost
 7    as determined by  multiplying  the  hospital  charge  by  the
 8    cost-to-charge   ratio.  "Charity  care"  shall  not  include
 9    Medicare and Medicaid shortfalls.
10        "Covered  facilities"   means   hospitals   and   related
11    organizations.
12        "Department" means the Department of Public Health.
13        "Gross  patient  revenues"  means gross revenues received
14    from program services, including bad debt and charity care.
15        "Hospital" means a health care  facility  licensed  under
16    the Hospital Licensing Act.
17        "Net patient revenue" means revenue excluding contractual
18    allowances, negotiated discounts, charity care, and bad debt.
19        "Related  organization"  means  an  organization, whether
20    publicly owned, nonprofit, tax-exempt, or for-profit, that is
21    related to a hospital through  common  membership,  governing
22    bodies,  trustees, officers, stock ownership, family members,
23    partners or limited partners, including but  not  limited  to
24    subsidiaries,  foundations,  related  corporations, and joint
25    ventures. An organization is considered to be  related  to  a
26    hospital if one of the following conditions is met:
27             (1)  The organization controls or is controlled by a
28        hospital  through contracts or other legal documents that
29        give the organization the authority to direct any of  the
30        hospital's  activities,  management, or policies or allow
31        the  hospital  to  direct  any  of   the   organization's
32        activities, management, or policies.
33             (2)  The  organization  has  solicited  funds in the
34        name of the hospital with the express or implied approval
 
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 1        of the hospital and a substantial portion  of  the  funds
 2        was intended by the contributor or was otherwise required
 3        to be used for the benefit of the hospital.
 4             (3)  The  hospital  has transferred resources to the
 5        organization   and   a   substantial   portion   of   the
 6        organization's resources is held for the benefit  of  the
 7        hospital.
 8             (4)  The  organization  has transferred resources to
 9        the hospital and a substantial portion of the  hospital's
10        resources is held for the benefit of the organization.
11             (5)  The   hospital  has  assigned  certain  of  its
12        functions  to  the  organization,  which   is   operating
13        primarily for the benefit of the hospital.
14             (6)  The organization is wholly owned or was created
15        by  the  hospital,  and  the hospital receives any of the
16        profits of the organization.
17             (7)  The hospital is wholly owned or was created  by
18        the  organization,  and  the organization receives any of
19        the profits of the hospital.
20             (8)  In the event of the dissolution of the  related
21        entity,  substantially  all  of  the assets of the entity
22        would become property of the creating entity.

23        Section 20.  Annual public disclosure report.
24        (a)  Every  covered  facility   shall   file   with   the
25    Department an annual public disclosure report prepared by the
26    covered  facility's  auditor or independent accountant within
27    120 days  after  the  end  of  its  fiscal  year,  unless  an
28    extension is granted by the Department for good cause shown.
29        (b)  The  annual  public  disclosure  report shall be for
30    each individual hospital  or  related  organization.  If  the
31    hospital  or related organization is a division or subsidiary
32    of another entity that owns or operates  other  hospitals  or
33    related  organizations,  the  annual public disclosure report
 
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 1    shall be for the specific division or subsidiary and not  for
 2    the   aggregate   of   or   combined   hospitals  or  related
 3    organizations of the other entity.
 4        (c)  The annual public disclosure  report  shall  contain
 5    all of the following:
 6             (1)  A  complete audited financial statement for the
 7        preceding  fiscal  year  prepared  and  presented  by  an
 8        independent accountant or  the  auditor  of  the  covered
 9        facility. All notes, schedules, and documents as required
10        by  the  nationally  recognized auditing guidelines shall
11        accompany the financial statement.
12             (2)  A note or addendum  to  the  audited  financial
13        statement that includes all of the following:
14                  (A)  Gross   patient  revenues  categorized  by
15             payer source.
16                  (B)  Net patient revenues categorized by  payer
17             source.
18                  (C)  Bad debt by payer source.
19                  (D)  The monetary valuation and type of charity
20             care  provided,  reported by payer source and valued
21             at   cost   as   calculated   by   multiplying   the
22             cost-to-charge ratio by the charge. For the  purpose
23             of  this  item (D), "at cost" shall be calculated by
24             applying  the  cost-to-charge  ratios   derived   in
25             accordance   with   generally   accepted  accounting
26             principles for hospitals to charges. The calculation
27             of the cost-to-charge ratios shall be based  on  the
28             most  recently  completed  and audited Medicaid Cost
29             Report.   The  7  categories  of  payer  source  are
30             Medicare,       Medicaid,      Commercial,      HMO,
31             Self-administered, Self-pay, and Other.
32             (3)  Debt  collection   policies   and   procedures,
33        including policies for identifying third-party payers and
34        procedures for pursuing court action.
 
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 1             (4)  Charity     care    definitions,    application
 2        procedures, policies, and means of informing  the  public
 3        about charity care.
 4             (5)  A  complete schedule of current charges for all
 5        patient services provided by the covered facility at  the
 6        close of its fiscal year.
 7             (6)  A statement of services available and rendered.
 8             (7)  Proof  of  public  notification that the annual
 9        public disclosure report is available.
10        (d)  Every covered facility  shall  also  file  with  the
11    Department  the  following statements, reports, and schedules
12    in such form and at such intervals as may be specified by the
13    Department, but at least annually:
14             (1)  The approved  budget  and  the  annual  capital
15        expenditures  budget  for  the  upcoming fiscal year that
16        sets forth the  total  financial  needs  of  the  covered
17        facility  and  the  resources  available  or  expected to
18        become available to meet such needs.
19             (2)  If the covered facility is certified under  the
20        federal Medicare or Medicaid programs, a complete copy of
21        all  cost reports submitted to the Medicaid State agency,
22        Medicare   intermediaries,   or   other   State    agency
23        administering  legislative  directed  funding.  If such a
24        report is not prepared by the  facility  or  organization
25        within a given fiscal year, then it shall file a complete
26        schedule  of costs allocated to each category of costs in
27        accordance  with  standards  established  by  the   State
28        Medicaid office.
29             (3)  A  copy  of such reports made or filed with the
30        Center for Medicare and Medicaid Services, including  the
31        Wage and Salary Survey.
32             (4)  A  statement  of all charges, fees, or salaries
33        for goods or services rendered to the covered facility or
34        related organization for the period reported that  exceed
 
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 1        in total $55,000 and a statement of all charges, fees, or
 2        other  sums  collected  by the covered facility for or on
 3        the   account   of   any   person,   firm,   partnership,
 4        corporation, or other entity,  however  structured,  that
 5        exceed  in total $55,000 during the period reported. This
 6        requirement does not apply to payments made or due  as  a
 7        result  of  services  rendered  to  patients, clients, or
 8        residents to whom the covered facility typically provides
 9        services.
10             (5)  A copy of all tax returns required to be  filed
11        by federal and State law.
12        (e)  The  annual  public  disclosure report shall be made
13    available to consumers upon  request  at  the  Department  of
14    Public Health and on-site at each hospital.

15        Section  25.  Patient  access  to  bills. Hospitals shall
16    include on their admission forms a conspicuous notice stating
17    that the patient may, upon request, receive  a  copy  of  all
18    individual hospital charges related to the patient. Admission
19    forms  shall also include a conspicuous notice specifying the
20    name and contact information of a person whom the patient may
21    contact to request a copy of the hospital charges related  to
22    the patient.
23        Hospitals  shall  include in their bills to patients, and
24    to any third-party payers  unless  previously  furnished,  an
25    explanation  of  any items identified by any code or initial.
26    Within 30 days of a request by a patient,  a  hospital  shall
27    provide  the  patient  an  itemized  bill free of charge. The
28    itemized  bill  shall  identify,  in  plain  language,   each
29    individual  service,  supply,  or  medication provided to the
30    patient by the hospital, the specific charge for the service,
31    supply, or medication, and the name and  contact  information
32    of a person whom the patient may contact with questions.
 
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 1        Section 30.  Department reports. The Department of Public
 2    Health shall prepare an annual report to the General Assembly
 3    listing  those  hospitals that have failed to comply with the
 4    requirements of this Act. The  Department  of  Public  Health
 5    shall use the information submitted to prepare reports at the
 6    request of the General Assembly or the Governor. From time to
 7    time,  the Department may engage in or carry out analyses and
 8    studies relating to health care costs, the  financial  status
 9    of any covered facility or related organization, or any other
10    appropriate  related  matters, and may make determinations of
11    whether, in its opinion,  the  rates  charged  by  a  covered
12    facility  are  economically  justified.  The Department shall
13    use the  information  submitted  to  publish  charts  on  its
14    website  comparing  charges  by procedure and by facility for
15    procedures identified by the Department.

16        Section 35.  Confidentiality and public availability.  No
17    report,  statement,  schedule,  or  other  filing required or
18    permitted to be filed with  the  Department  under  this  Act
19    shall   contain   any   medical   or  individual  information
20    personally identifiable to a patient or a consumer of  health
21    services,  either  directly  or indirectly. All such reports,
22    statements, and schedules filed  with  the  Department  under
23    this  Act  shall  be  open  to public inspection and shall be
24    available for examination during regular hours. Copies of the
25    reports shall be made available to the public  upon  request.
26    The annual public disclosure report for each hospital and its
27    related  organizations shall be open to public inspection and
28    shall be available during regular hours at the hospital site.
29        Tax returns filed by for-profit  hospitals  shall  remain
30    confidential, and the Department, its officers, employees, or
31    agents  shall  not  divulge  or  make  any  part  known.  The
32    Department  may  release  statistical  data  based upon these
33    records.
 
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 1        Section  40.  Verification   of   information.   Whenever
 2    further  fiscal information is deemed necessary to verify the
 3    accuracy  of  any  information  set  forth  in  a  statement,
 4    schedule, or report filed by a  covered  facility  under  the
 5    provisions  of  this  Act,  the  Department  shall  have  the
 6    authority  to require the production of any records necessary
 7    to verify that information

 8        Section 45.  Whistleblower protection.
 9        (a)  A covered facility subject to the provisions of this
10    Act  may   not   discharge,   demote,   threaten,   penalize,
11    discriminate,  or  retaliate  against  any person or employee
12    with  respect  to   compensation,   terms,   conditions,   or
13    privileges  of employment as a reprisal because the person or
14    employee,  acting  in  good   faith,   individually   or   in
15    conjunction  with  another  person or persons does any of the
16    following:
17             (1)  Reports a violation or suspected  violation  of
18        this  Act  to  a  public  regulatory  agency,  a  private
19        accreditation   body,  or  management  personnel  of  the
20        covered facility.
21             (2)  Initiates   or    cooperates    or    otherwise
22        participates in an investigation or proceeding brought by
23        a  regulatory  agency  or  accreditation  body concerning
24        matters covered by this Act.
25             (3)  Informs or discusses  violations  or  suspected
26        violations    of   this   Act   with   other   employees,
27        representatives  of  employees,   patients   or   patient
28        representatives, or the public.
29             (4)  Provides  or attempts to provide information to
30        the Department regarding possible violations of this Act.
31        (b)  An employee is presumed to have acted in good  faith
32    if  the  employee  reasonably  believes  that the information
33    reported or disclosed  is  true  and  that  a  violation  has
 
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 1    occurred or may occur.
 2        (c)  A  person  or employee or former employee subject to
 3    the provisions of this Act who believes that he  or  she  has
 4    been discharged or discriminated against in violation of this
 5    Section may file a civil action within 3 years after the date
 6    of  the  discharge or discrimination. If a court of competent
 7    jurisdiction finds by a preponderance of the evidence that  a
 8    violation  of  this Section has occurred, the court may grant
 9    the  relief  it  deems  appropriate,  including  any  of  the
10    following:
11             (1)  Reinstatement of the employee to the employee's
12        former position.
13             (2)  Compensatory  damages,  costs,  and  reasonable
14        attorney fees.
15             (3)  Other legal and equitable relief to remedy  the
16        violation,  as  may  be  appropriate  to  effectuate  the
17        purposes of this Act.
18        (d)  The  protections of this Section do not apply to any
19    employee  or  person   who   (i)   deliberately   causes   or
20    participates  in  the  alleged violation or (ii) knowingly or
21    recklessly provides substantially false  information  to  the
22    Department.

23        Section 50.  Penalties. The Department may assess a civil
24    penalty  against  a covered facility that fails to submit the
25    materials required by this Act. The penalty  may  not  exceed
26    $1,000  for each day a report is delinquent after the date on
27    which the report is due.

28        Section 55.  Third-party payor identification.
29        (a)  Each hospital shall make every reasonable effort  to
30    determine  the  existence  or  nonexistence  of  a private or
31    public third-party payor that might cover in full or in  part
32    the charges for care rendered by the hospital to a patient.
 
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 1        (b)  An   initial   determination  of  sponsorship  shall
 2    precede  collection  efforts   directed   at   the   patient.
 3    Collection  efforts  may  not  be  undertaken by the hospital
 4    toward the patient if  the  insurance  company  is  currently
 5    processing the claim or the patient has appealed the decision
 6    of the insurance company.
 7        (c)  At the time of admission, the hospital shall provide
 8    each  patient  that  indicates that he or she does not have a
 9    third-party  payor  a  language-appropriate   list   of   the
10    eligibility  policies  and procedures for receiving Medicaid,
11    Medicare,  charity  care,  and  any  other  indigent  medical
12    programs provided by the hospital.
13        (d)  At the time of admission,  the  hospital  must  also
14    provide a language-appropriate written description of payment
15    options and debt collection practices and procedures.