HB1431 104TH GENERAL ASSEMBLY

LRB104 06839 BAB 16875 b

104TH GENERAL ASSEMBLY
State of Illinois
2025 and 2026
HB1431

Introduced 1/28/2025, by Rep. Maurice A. West, II

SYNOPSIS AS INTRODUCED:

New Act
815 ILCS 505/2HHHH new

Creates the Health Care Facility Fee Transparency Act. Sets forth provisions concerning notice requirements for a hospital or health system that charges a facility fee using a current procedural terminology evaluation code or assessment and management code for outpatient services provided at a hospital-based facility where a professional fee is also expected to be charged. Provides notice requirements for hospital-based facilities created or acquired through a business transaction. Establishes limitations on facility fees. Sets forth provisions concerning facility fee billing statements, reporting of facility fees charged by each hospital and health system, and enforcement of the Act by the Department of Public Health. Amends the Consumer Fraud and Deceptive Business Practices Act. Provides that it is an unlawful practice if, from the date of the transaction, a hospital, health system, or hospital-based facility does not wait at least 30 days after the written notice has been mailed to the patient or a copy of the notice has been filed with the Department of Public Health to collect a facility fee for services provided at a hospital-based facility.

A BILL FOR

AN ACT concerning regulation.

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 Health Care Facility Fee Transparency Act.

Section 5. Definitions. As used in this Act:

"Affiliated provider" means a provider who is (1) employed by a hospital or health system; (2) under a professional services agreement with a hospital or health system that permits the hospital or health system to bill on behalf of the provider; or (3) a clinical faculty member of a medical school that is affiliated with a hospital or health system in a manner that permits the hospital or health system to bill on behalf of the clinical faculty member.

"Campus" means (1) the physical area immediately adjacent to a hospital's main buildings and other areas and structures that are not strictly contiguous to the main buildings but are located within 250 yards of the main buildings; or (2) any other area that has been determined on an individual basis by the Department of Public Health, the Department of Human Services, or other State agency to be a part of a hospital's campus.

"Facility fee" means any fee charged or billed by a hospital or health system for outpatient services provided in a hospital-based facility that is: (1) intended to compensate the hospital or health system for the operational expenses of the hospital or health system; and (2) separate and distinct from a professional fee.

"Freestanding emergency department" means a freestanding facility that (1) is structurally separate and distinct from a hospital; (2) provides emergency care; (3) is a department of a hospital licensed under the Hospital Licensing Act; and (4) has been issued a certificate of need to operate as a freestanding emergency department by the Health Facilities and Services Review Board by showing the need for such a department in the geographic area where the facility is situated.

"Health care provider" means an individual, entity, corporation, person, or organization, whether for-profit or not-for-profit, that furnishes bills or is paid for health care service delivery in the normal course of business, including, but not limited to, a health system, a hospital, a hospital-based facility, a freestanding emergency department, and an urgent care center.

"Health system" means (1) a parent corporation of one or more hospitals and any entity affiliated with such parent corporation through ownership, governance, membership, or other means; or (2) a hospital and any entity affiliated with the hospital through ownership, governance, membership, or other means.

"Hospital" means an institution, place, building, or agency located in this State that is licensed as a general acute hospital by the Department of Public Health under the Hospital Licensing Act, whether public or private and whether organized for-profit or not-for-profit.

"Hospital-based facility" means a facility that is owned or operated, in whole or in part, by a hospital or health system where hospital or professional medical services are provided.

"Medicaid" means the federal medical assistance program established under Title XIX of the Social Security Act.

"Observation" means services furnished by a hospital on the hospital's campus, regardless of the length of stay, including use of a bed and periodic monitoring by the hospital's nursing or other staff, to evaluate an outpatient's condition or determine the need for admission to the hospital as an inpatient.

"Payer mix" means the proportion of different sources of payment received by a hospital or health system, including, but not limited to, Medicare, Medicaid, other government-provided insurance, private insurance, and self-pay patients.

"Provider" means an individual, entity, corporation, or health care provider, whether for-profit or not-for-profit, whose primary purpose is to provide professional medical services.

Section 10. Facility fee disclosure.

(a) If a hospital or health system charges a facility fee using a current procedural terminology evaluation (CPT E/M) code or assessment and management (CPT A/M) code for outpatient services provided at a hospital-based facility where a professional fee is also expected to be charged, the hospital or health system shall provide the patient with a written notice that includes the following information:

(1) that the hospital-based facility is part of a hospital or health system, and that the hospital or health system charges a facility fee that is in addition to and separate from the professional fee charged by the provider;

(2)(A) the amount of the patient's potential financial liability, including any facility fee likely to be charged, and, if professional medical services are provided by an affiliate provider, any professional fee likely to be charged or, if the exact type and extent of the professional medical services needed are not known or the terms of a patient's health insurance coverage are not known with reasonable certainty, an estimate of the patient's financial liability based on typical or average charges for visits to the hospital-based facility, including the facility fee; (B) a statement that the patient's actual financial liability will depend on the professional medical services actually provided to the patient; (C) an explanation that the patient may incur financial liability that is greater than the patient would incur if the professional medical services were not provided by a hospital-based facility; and (D) a telephone number the patient may call for additional information regarding the patient's potential financial liability, including an estimate of the facility fee likely to be charged based on the scheduled professional medical services; and

(3) that the hospital or health system may not collect directly from the patient facility fees for services without an inpatient stay component, and that a patient covered by a health insurance policy should contact the health insurer for additional information regarding the hospital's or health system's charges and fees, including the patient's potential financial liability, if any, for those charges and fees.

(c) If a hospital or health system charges a facility fee without using a current procedural terminology evaluation and management (CPT E/M) code for outpatient services provided at a hospital-based facility located outside of the hospital campus, the hospital or health system shall provide the patient with a written notice that includes the following information:

(1) that the hospital-based facility is part of a hospital or health system, and that the hospital or health system charges a facility fee that may be in addition to and separate from the professional fee charged by a provider;

(2)(A) a statement that the patient's actual financial liability will depend on the professional medical services actually provided to the patient; (B) an explanation that the patient may incur financial liability that is greater than the patient would incur if the hospital-based facility was not hospital-based; and (C) a telephone number the patient may call for additional information regarding the patient's potential financial liability, including an estimate of the facility fee likely to be charged based on the scheduled professional medical services; and

(3) that the hospital or health system may not collect directly from the patient facility fees for services without an inpatient stay component, and that a patient covered by a health insurance policy should contact the health insurer for additional information regarding the hospital's or health system's charges and fees, including the patient's potential financial liability, if any, for those charges and fees.

(d) The notices required by this Section shall be in plain language and in a form that may be reasonably understood by a patient who does not possess special knowledge regarding hospital or health system facility fee charges. Beginning January 1, 2027, the written notices shall include tag lines in at least the most common 15 languages spoken in the State, indicating that the notice is available in each of those languages.

(e) Hospital-based facilities shall prominently display the written notices required by this Section in locations that are readily accessible to and visible by patients, including patient waiting or appointment check-in areas, stating: (1) that the hospital-based facility is part of a hospital or health system; (2) the name of the hospital or health system; and (3) that, if the hospital-based facility charges a facility fee, the patient may incur financial liability greater than the patient would incur if the hospital-based facility fee was not hospital-based. Beginning January 1, 2026, the written notices shall include tag lines in at least the most common 15 languages spoken in the State indicating the notice is available in each of those most common 15 languages. No later than July 1, 2026, and annually thereafter, each hospital-based facility shall submit a copy of the written notice required by this subsection to the Department of Public Health.

Section 15. Timing of notice.

(a) For nonemergency care, if a patient's appointment is scheduled to occur 10 or more days after the appointment is made, written notice shall be sent to the patient by first-class mail, encrypted email, or a secure patient Internet portal no fewer than 3 days after the appointment is made. If an appointment is scheduled to occur fewer than 10 days after the appointment is made or if the patient arrives without an appointment, notice shall be hand-delivered to the patient when the patient arrives at the hospital-based facility.

(b) For emergency care, written notice shall be provided to the patient as soon as practicable after the patient is stabilized in accordance with the federal Emergency Medical Treatment and Active Labor Act, 42 U.S.C. 1395dd, or is determined not to have an emergency medical condition and before the patient leaves the hospital-based facility. If the patient is unconscious, under great duress, or for any other reason unable to read the notice and understand and act on the patient's rights, the notice shall be provided to the patient's representative as soon as practicable.

Section 20. Proactive notice.

(a) A hospital-based facility shall clearly hold itself out to the public and payers as being hospital-based, including, at minimum, by stating the name of the hospital or health system in its signage, marketing materials, websites, and stationery.

(b) A hospital-based facility, when scheduling services for which a facility fee may be charged, shall inform the patient: (1) that the hospital-based facility is part of a hospital or health system; (2) of the name of the hospital or health system; (3) that the hospital or health system may charge a facility fee in addition to and separate from the professional fee charged by the provider; and (4) of the telephone number the patient may call for additional information regarding the patient's potential financial liability.

Section 25. Notice of establishment of hospital-based facility by purchase.

(a) If any merger, acquisition, or similar business transaction results in the establishment of a hospital-based facility at which facility fees may be billed, where such a hospital-based facility did not previously exist, the purchaser in the transaction shall, no later than 30 days after the transaction, provide written notice by first-class mail of the transaction to each patient served within the 3 years preceding the date of the transaction by the health care facility that has been purchased or acquired as part of the transaction.

(b) The notice under this Section shall include the following information:

(1) A statement that the health care facility is now a hospital-based facility and is part of a hospital or health system, the health care facility's full legal and business name, and the date of the facility's acquisition by a hospital or health system.

(2) The name, business address, and phone number of the hospital or health system that is the purchaser of the health care facility.

(3) A statement that the hospital-based facility bills, or is likely to bill, patients a facility fee that may be in addition to and separate from any professional fee billed by a health care provider at the hospital-based facility.

(4) A statement that the patient's actual financial liability will depend on the professional medical services actually provided to the patient, and an explanation that the patient may incur financial liability that is greater than the patient would incur if the hospital-based facility were not a hospital-based facility.

(5) The estimated amount or range of amounts the hospital-based facility may bill for a facility fee or an example of the average facility fee billed at the hospital-based facility for the most common services provided at the hospital-based facility.

(6) A statement that, prior to seeking services at the hospital-based facility, a patient covered by a health insurance policy should contact the patient's health insurer for additional information regarding the hospital-based facility fees, including the patient's potential and financial liability, if any, for those hospital-based facility fees.

(c) A copy of the written notice provided to patients in accordance with this Section shall be filed with the Department of Insurance. A link to copies of these written notices shall be conspicuously available on the Department of Insurance's website.

(d) A hospital, health system, or hospital-based facility shall not collect a facility fee for services provided at a hospital-based facility that is subject to this Section from the date of the transaction until at least 30 days after the written notice required pursuant to this Section is mailed to the patient or a copy of the notice is filed with the Department of Public Health, whichever is later. A violation of this subsection is a deceptive business practice under the Consumer Fraud and Deceptive Business Practices Act.

(e) Not later than July 1, 2026, and annually thereafter, each hospital-based facility that was the subject of a transaction, as described in subsection (a) of this Section, during the preceding calendar year shall report to the Department of Insurance the number of patients served by the hospital-based facility in the preceding 3 years.

Section 30. Limitations on facility fees.

(a) Notwithstanding any other provision of this Act or law, on and after January 1, 2026, no health care provider or health system may charge, bill, or otherwise collect a facility fee directly from a patient who is not covered by the patient's insurance for:

(1) any preventive care services that are provided in an outpatient setting;

(2) any clinic visits. As used in this paragraph (2), "clinic" means any outpatient program conducted by a locally based not-for-profit, or by a local board of health whose health department is recognized by, and has a designation status established by, the Department of Public Health and complies with the Public Health Standing Orders Act; or

(3) any other services that do not include an inpatient stay component.

(b) Notwithstanding any other provision of this Act or other law, on or after January 1, 2026, no hospital, health system, or hospital-based facility shall collect a facility fee for outpatient health care services that use a current procedural terminology evaluation and management (CPT E/M) code or assessment and management (CPT A/M) code and are provided at a hospital-based facility located off-site from a hospital campus received by a patient who is uninsured of more than the Medicare rate.

(c) Notwithstanding any other provision of this Act or other law, on or after January 1, 2026, no hospital or health system shall collect a facility fee for outpatient health care services that use a current procedural terminology evaluation and management (CPT E/M) code or assessment and management (CPT A/M) code and are provided on the hospital campus. This subsection does not apply to (1) an emergency department located on a hospital campus or (2) observation stays on a hospital campus and current procedural terminology evaluation and management (CPT E/M) code and current procedural terminology assessment and management (CPT A/M) code when billed for the following services: (i) wound care, (ii) orthopedics, (iii) anticoagulation, (iv) oncology, (v) obstetrics, and (vi) solid organ transplant.

(d) Nothing in this Section prohibits a health care provider from charging a facility fee for:

(1) health care services provided in an inpatient setting; or

(2) emergency services provided at a licensed freestanding emergency department.

(e) Nothing in this Section prohibits a health provider or health system from charging, billing, or collecting a facility fee from a patient's insurer pursuant to an agreement between the health care provider or health system and the carrier, or as required by law.

(f) Notwithstanding subsections (b) and (c) of this Section, in circumstances in which an insurance contract that was in effect on January 1, 2026 provides reimbursement for facility fees prohibited under subsection (b) of this Section and in circumstances in which an insurance contract that is in effect on January 1, 2026 provides reimbursement for facility fees prohibited under subsection (c) of this Section, a hospital or health system may continue to collect reimbursement from the health insurer for those facility fees until the applicable date of expiration, renewal, or amendment of the insurance contract, whichever date is earliest.

Section 35. Billing statements.

(a) Each initial billing statement that includes a facility fee shall:

(1) clearly identify the fee as a facility fee that is billed in addition to, or separately from, any professional fee billed by the provider;

(2) provide the corresponding Medicare facility fee reimbursement rate for the same service as a comparison or, if there is no corresponding Medicare facility fee for the service:

(A) the approximate amount Medicare would have paid the hospital for the facility fee on the billing statement; or

(B) the percentage of the hospital's charges that Medicare would have paid the hospital for the facility fee;

(3) include a statement that the facility fee is intended to cover the hospital's or health system's operational expenses;

(4) inform the patient that the patient's financial liability may have been less if the services had been provided at a facility not owned or operated by the hospital or health system; and

(5) include written notice of the patient's right to request a reduction in the facility fee or any other portion of the bill and a telephone number that the patient may use to request a reduction without regard to whether the patient qualifies for, or is likely to be granted, any reduction.

(b) Not later than July 1, 2026, and annually thereafter, each hospital, health system, and hospital-based facility shall submit to the Department of Public Health a sample of a billing statement issued by the hospital, health system, or hospital-based facility that complies with this Section and that represents the format of billing statements received by patients. The billing statement shall not contain patient identifying information.

Section 40. Reporting.

(a) Each hospital and health system shall report not later than July 1, 2026, and annually thereafter, to the Director of Public Health, on a form prescribed by the Department of Public Health, concerning facility fees charged or billed during the preceding calendar year. The report shall include, but need not be limited to:

(1) the name and address of each facility owned or operated by the hospital or health system that provides services for which a facility fee is charged or billed, and an indication as to whether each facility is located on or outside of the hospital or health system campus;

(2) the number of patient visits at each facility for which a facility fee was charged or billed;

(3) the number, total amount, and range of allowable facility fees paid at each facility disaggregated by payer mix;

(4) for each facility, the total amount of facility fees charged and the total amount of revenue received by the hospital or health system derived from facility fees;

(5) the total amount of facility fees charged and the total amount of revenue received by the hospital or health system from all facilities derived from facility fees;

(6) a description of the 10 procedures or services that generated the greatest amount of facility fee gross revenue, disaggregated by current procedural terminology category (CPT) code for each such procedure or service, and, for each such procedure or service, patient volume and the total amount of gross and net revenue received by the hospital or health system derived from facility fees, disaggregated by on-campus and off-campus; and

(7) the top 10 procedures or services for which facility fees are charged based on patient volume and the gross and net revenue received by the hospital or health system for each such procedure or service, disaggregated by on-campus and off-campus.

(b) The Department of Public Health shall publish the information reported pursuant to subsection (a) of this Section or post a link to the information on the Department of Public Health's website.

(c) As used in this Section, "facility" means a hospital-based facility that is located on a hospital campus or outside a hospital campus.

Section 45. Enforcement.

(a) On and after January 1, 2026, if the Director of Public Health receives information and has a reasonable belief, after evaluating that information, that any hospital, health system, or hospital-based facility charged facility fees, other than through isolated clerical or electronic billing errors, in violation of any provision of this Act or rule adopted under this Act, the hospital, health system, or hospital-based facility shall be subject to a civil penalty of up to $1,000. The Director of Public Health may issue a notice of violation and civil penalty by first-class mail or personal service. The notice shall include:

(1) a reference to the Section of the statutes, rule, or Section of the rules alleged to have been violated;

(2) a short and plain language statement of the matters asserted or charged;

(3) a description of the activity to cease;

(4) a statement of the amount of the civil penalty or penalties that may be imposed;

(5) a statement concerning the right to a hearing; and

(6) a statement that the hospital, health system, or hospital-based facility may, not later than 10 business days after receipt of the notice, make a request for a hearing on the matters asserted.

(b) The hospital, health system, or hospital-based facility to whom notice is provided pursuant to subsection (a) of this Section may, not later than 10 business days after receipt of the notice, make written application to the Department of Public Health to request a hearing to demonstrate that the violation did not occur. The failure to make a timely request for a hearing shall result in the issuance of a cease and desist order or civil penalty. All hearings held under this subsection shall be conducted in accordance with the Illinois Administrative Procedure Act.

(c) Following any hearing pursuant to this Section, if the Department of Public Health finds, by a preponderance of the evidence, that the hospital, health system, or hospital-based facility violated or is violating any provision of this Act, any rule adopted under this Act, or any order issued by the Department of Public Health, the Department of Public Health shall issue a final cease and desist order in addition to any civil penalty the Department of Public Health imposes.

Section 50. The Consumer Fraud and Deceptive Business Practices Act is amended by adding Section 2HHHH as follows:

(815 ILCS 505/2HHHH new)

Sec. 2HHHH. Violations of the Health Care Facility Fee Transparency Act. Any person who violates subsection (d) of Section 25 of the Health Care Facility Fee Transparency Act commits an unlawful practice within the meaning of this Act.