Legislation would regulate hidden medical facility fees

When Sean Dundon cut his thumb on Christmas Day, all the urgent care centers were closed, so he went to Mercy Hospital’s emergency room. He was in and out of the hospital in 20 minutes, and was surprised when a $600 facility fee was added to his bill because he was treated in a hospital. Derek Davis/Staff Photographer

A new proposal before Maine’s Legislature would regulate hidden and unexpected hospital charges that can add hundreds of dollars to routine medical bills.

The measure, which is based on recommendations from a study done by a legislative task force, would require hospitals to post signs in waiting rooms and other areas letting patients know whether a so-called facility fee is being charged and, if so, posting a notice that “the patient may incur a financial liability greater than the patient would incur” in a non-hospital setting.

It also would ban such fees from being charged for telehealth services when the patient doesn’t come to a hospital. It would not prohibit hospitals from assessing the fees in other cases, as long as advance notice is provided.

Facility fees are charged by health care providers to help pay the overhead costs of running hospitals and other large medical facilities.

A Press Herald investigation revealed that hospitals sometimes hide the fees in medical bills with no explanation. And insurance companies sometimes refuse to cover them, leaving patients on the hook for hundreds of dollars in unexpected fees simply because they went to a hospital instead of seeking treatment from another provider.

After the story was published, Senate President Troy Jackson, D-Allagash, introduced a bill to regulate the fees. The bill was amended to form a commission to study the topic, and the commission’s recommendations became the basis for a new bill, L.D. 2271, which was published Thursday. It will be taken up by lawmakers in the coming weeks.

Kate Ende, policy director for Consumers for Affordable Health Care, a patient advocacy group, served on the facility fee commission and said the bill will help some patients avoid the fees.

“The transparency will empower consumers to make informed decisions,” Ende said. “Many people did not realize they would be charged a facility fee, nor did they realize that they could get the same service at alternative locations that didn’t charge a facility fee. This allows consumers to make informed choices so they will not be caught off guard.”

Ende said the ban on charging facility fees for telehealth appointments is welcomed, after hearing stories from patients who were charged such fees after not even leaving their home for a medical appointment.

“People are often very surprised when they are charged a facility fee when they didn’t even enter a facility,” Ende said.

Consumers for Affordable Health Care conducted a survey this winter that asked Maine people about facility fees, and found that 27% said they had been charged such a fee, and that 62% said the fees were “excessive.”

HOSPITAL GROUP MUM

Jeff Austin, vice president of government affairs for the Maine Hospital Association, said “we won’t be providing a comment” when asked if the association supports or opposes the bill.

Austin also served on the study commission and objected to some recommendations in the report, including more stringent regulations that were suggested in the report but did not make it into the final bill. One recommended provision that did not make it into the bill would have banned facility fees from being charged at hospital-affiliated facilities that weren’t located on the main hospital campus.

Stephanie DuBois, spokeswoman for the Anthem Blue Cross Blue Shield insurance company, said “we are still reviewing the proposed legislation, but we are pleased to see the Legislature is continuing the conversation about this important issue, and greater transparency in health care to protect affordability.”

Lawmakers also passed a different bill this year to promote transparency in medical bills. The bill, which Gov. Janet Mills signed into law, requires health care systems to disclose in medical bills where health service was rendered. In some cases, Anthem officials said, contracts between providers and insurance companies would preclude charging hospital prices at off-campus buildings.