Hospital facility fees to be investigated under new law

Under legislation signed into law Tuesday by Gov. Janet Mills, a state task force will investigate “facility fees” hospitals and other health care providers often charge patients to defray overhead costs for the buildings where they receive care.

The new law also requires providers to report the fees to the state, which will share them publicly.

Senate President Troy Jackson first proposed a bill in August 2022 to regulate and restrict facility fees, which are sometimes tacked onto patients’ bills with little or no explanation.

His proposal followed an investigative report by the Portland Press Herald revealing the impact of the charges, which can raise a patient’s bill by hundreds of dollars. Often, the charges are added after a patient has received an insurance company estimate of the out-of-pocket costs for care.

The original bill, L.D. 1795, aimed to fully restrict facility fees in specific cases and create an annual report compiled by hospitals about their facility fees that would be published by the Department of Health and Human Services.

In May, however, the Legislature’s Committee on Health Coverage, Insurance and Financial Services approved an amendment creating the investigative task force, which will determine the extent of the fees and publish the information on the Maine Health Data Organization website. Mills signed the amended mill.

The task force will include state legislators, the director of MaineCare, the director of the Office of Affordable Health Care, and representatives from various statewide groups focused on the elderly, health insurance and hospital advocacy.

“The increased use of so-called ‘facility fees’ has only made it more difficult for patients to know how much they will owe when they leave the lab or doctor’s office. What’s worse is that these fees are often avoidable, but patients don’t know they exist until it is too late,” Jackson said.

“This new law will help us better understand the scope of the problem and equip the Legislature with the tools to enact laws that make a meaningful difference for Mainers.”

“Hospitals are prepared to work with the Legislature and help them understand both our cost structure, as well as how the many different reimbursement systems work,” Maine Hospital Association spokesman Jeff Austin said. “We remain opposed to having the state eliminate our ability to receive reimbursement for the services hospitals provide. We’re hopeful that further conversations will help.”

Another group, Consumers for Affordable Health Care, hopes the law pushes legislators to make services less costly.

“This legislation we see as a necessary step for ensuring transparency for Maine people and also providing policymakers with the information and data they need to help create new policies to improve access to affordable health care,” said Kate Ende, the group’s policy director.

The task force is expected to conclude its findings and propose further legislation to the Committee on Health Coverage, Insurance and Financial Services by Dec. 6.