HB4753 94TH GENERAL ASSEMBLY

LRB094 17374 DRJ 52669 b

94TH GENERAL ASSEMBLY
State of Illinois
2005 and 2006
HB4753

Introduced 01/13/06, by Rep. Karen May

SYNOPSIS AS INTRODUCED:

New Act

Creates the Hospital Charity Care Act. Provides that no hospital or its medical staff shall adopt or maintain admission practices or policies that result in any of the following: (i) a significant reduction in the proportion of patients who have no third-party coverage and who are unable to pay for hospital services; (ii) a significant reduction in the proportion of individuals admitted for inpatient hospital services for which payment is, or is likely to be, less than the anticipated charges for or costs of such services; or (iii) the refusal to admit patients who would be expected to require unusually costly or prolonged treatment for reasons other than those related to the appropriateness of the care available at the hospital. Provides that no hospital shall adopt or maintain practices or policies that would deny access to emergency care based on ability to pay. Requires every hospital to maintain a charity care policy and sliding fee schedule and to provide notice of the policy to patients. Also regulates a hospital's debt collection activities. Provides for administration of the Act by the Department of Public Health.

FISCAL NOTE ACT MAY APPLY

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 Hospital Charity Care Act.

Section 5. Definitions. In this Act:

"Charity care" means necessary hospital health care rendered to indigent persons, to the extent that the persons are unable to pay for the care or to pay deductibles or co-insurance amounts required by a third-party payer, as determined by the Department.

"Department" means the Department of Public Health.

"Federal poverty guidelines" means the poverty income guidelines established annually by the federal Department of Health and Human Services.

"Hospital" means a hospital licensed under the Hospital Licensing Act or subject to the University of Illinois Hospital Act.

"Sliding fee schedule" means a hospital-determined, publicly available schedule of discounts for persons deemed eligible for charity care.

"Special studies" means studies that have not been funded through appropriations to the Department.

Section 10. Admission practices. No hospital or its medical staff shall adopt or maintain admission practices or policies that result in any of the following:

(1) A significant reduction in the proportion of patients who have no third-party coverage and who are unable to pay for hospital services.

(2) A significant reduction in the proportion of individuals admitted for inpatient hospital services for which payment is, or is likely to be, less than the anticipated charges for or costs of such services.

(3) The refusal to admit patients who would be expected to require unusually costly or prolonged treatment for reasons other than those related to the appropriateness of the care available at the hospital.

Section 15. Emergency care; transfers.

(a) No hospital shall adopt or maintain practices or policies that would deny access to emergency care based on ability to pay.

(b) No hospital that maintains an emergency department shall transfer a patient with an emergency medical condition or who is in active labor unless the transfer is performed at the request of the patient or is due to the limited medical resources of the transferring hospital. A hospital must follow reasonable procedures in making transfers to other hospitals, including confirmation of acceptance of the transfer by the receiving hospital.

Section 20. Charity care policy.

(a) For the purpose of providing charity care, every hospital shall develop, implement, and maintain a charity care policy that, consistent with Section 10, shall enable people with family income below 200% of the federal poverty guidelines to have access to appropriate hospital-based medical services, and a sliding fee schedule for determination of discounts for persons with family income up to 400% of the federal poverty guidelines or whose family income is otherwise not sufficient to enable them to pay for their care or to pay deductibles or coinsurance amounts required by a third-party payer. The Department shall adopt specific guidelines to assist hospitals in setting sliding fee schedules required by this Section. All persons with family income below 200% of the federal poverty guidelines shall be deemed charity care patients for the full amount of hospital charges, provided that such persons are not eligible for other private or public health coverage sponsorship. Persons who may be eligible for charity care shall be notified by the hospital.

(b) Every hospital shall provide notice to patients of its charity care policies. At a minimum, every hospital must post in locations easily accessible to and visible by patients, and include in each bill sent to patients, a notice regarding the opportunity to apply for charity care. The notice must use clear language that would be easily understood by individuals with limited education.

Section 25. Private or public sponsorship. Every hospital shall make every reasonable effort to determine: (i) the existence or nonexistence of private or public sponsorship that might cover in full or part the charges for care rendered by the hospital to a patient; (ii) the family income of the patient as classified under federal poverty guidelines; and (iii) the eligibility of the patient for charity care as defined in this Act and in accordance with hospital policy. An initial determination of sponsorship status shall precede collection efforts directed at the patient.

Section 30. Sliding fee schedule.

(a) Every hospital must establish a sliding fee schedule. The schedule must be based on discounts to payment rates that the hospital would be paid by its largest private third-party payer and must be established based on consideration of guidelines developed by the Department.

(b) Upon a determination by a hospital that a person is eligible for a sliding fee schedule discount, the hospital shall offer that person the option to pay his or her bill in reasonable installments that take into account the person's income and other financial obligations. Interest rates for installment payment plans shall not exceed the consumer price index or 3% per annum, whichever is lower. A hospital shall provide general comparative information on the difference between the interest rate it will charge and the typical credit card or consumer bank loan interest rates. The information shall be provided in writing and shall use clear language that would be easily understood by individuals with limited education.

Section 35. Debt collection.

(a) Before contracting with any entity to act as a hospital's designated agent, assignee, or contractor for collection of its accounts receivable, or to purchase its accounts receivable, the hospital's governing board must have notice of, and affirmatively approve, the debt collection practices of the entity. The practices must include detailed information related to each of the following:

(1) Contacts with patients who have debts to the hospital, including written, telephonic, and electronic contacts.

(2) Policies related to the ability of debtors to make installment payments, and interest rates charged on any remaining balances.

(3) Circumstances under which the entity files civil actions to collect debts and undertakes any of the following collection actions to execute a judgment in connection with a debt: (i) actions to foreclose on real property; (ii) actions to place a lien on any property; (iii) actions to garnish wages; and (iv) actions to attach or seize a bank account or any other personal property.

(b) On at least an annual basis, the governing board of every hospital shall review all collection actions taken by the entity that has a contract with the hospital under subsection (a) of this section.

Section 40. Department's responsibilities.

(a) The Department shall adopt definitions by rule, as appropriate, for Section 10 and, with reference to federal requirements, Section 15. The Department shall monitor hospital compliance with Sections 10 and 15. The Department shall report individual instances of possible noncompliance to the Attorney General or the appropriate federal agency.

(b) The Department shall establish and maintain by rule, consistent with the definition of charity care in Section 5, the following:

(1) Uniform procedures, data requirements, and criteria for identifying patients receiving charity care.

(2) A definition of residual bad debt, including reasonable and uniform standards for collection procedures to be used in efforts to collect the unpaid portions of hospital charges that are the patient's responsibility.

(c) The Department shall monitor the distribution of charity care among hospitals, with reference to factors such as relative need for charity care in hospital service areas and trends in private and public health coverage. The Department shall prepare reports that identify any problems in distribution that are in contradiction of the intent of this Act. The report shall include an assessment of the effects of the provisions of this Act on access to hospital and health care services, as well as an evaluation of the contribution of all purchasers of care to hospital charity care.

(d) The Department shall issue a report on the subjects addressed in Sections 10, 15, 20, and 25 at least annually, with the first report due on March 1, 2007.