A bill in the Colorado legislature would let the state enforce federal price transparency laws, with the goal of getting enough data to create a cost comparison tool that more people are likely to use.
Federal law already requires hospitals to publish lists of the prices they charge to insurance plans and people paying out of pocket, as well as minimum and maximum prices. They also have to post a list of 300 “shoppable” services and their prices for easier comparisons.
SB23-252 would duplicate that requirement in state law, and direct the Colorado Department of Health Care Policy and Financing to assess if hospitals are complying. If they aren’t, the Colorado Attorney General’s Office would have the option to investigate them for deceptive trade practices.
“Transparency and sunshine will hopefully in the long run lead to lower prices,” said Sen. Julie Gonzales, a Denver Democrat and one of the bill’s co-sponsors.
The posted price files aren’t always easy to navigate because hospitals can use thousands of codes for billing, some of them with differences that may not be obvious to the patient. Requiring hospitals to submit their price lists to the state would help address that problem, said Bettina Schneider, chief financial officer at the Colorado Department of Health Care Policy and Financing. The department is working on a tool to make comparison shopping easier, but it needs complete data, she said.
The state already forbids hospitals from sending patients to collections or suing them if the facility hasn’t posted its prices as required under federal law, but it’s up to the patient to realize that and sue the hospital if it pursues them aggressively.
Representatives of health care organizations and consumer groups who testified before the Senate Health and Human Services Committee on Thursday evening said they didn’t know of any lawsuits filed under that authorization, though it’s possible that will change, since the law only took effect in August.
The committee voted 7-2 to send the bill to the full Senate. Three members who voted to pass the bill said they have significant concerns and would like to see changes to it, while one member who voted against it said he could change his mind if it’s amended.
Most of the debate centered on whether the bill would be unnecessarily burdensome or punitive to hospitals.
Katherine Mulready, chief strategy officer at the Colorado Hospital Association, said that hospitals already face possible lawsuits for transparency violations, as well as potential penalties from the federal Centers for Medicare and Medicaid Services. The agency can fine hospitals that haven’t posted all their prices, but they’ve only used that power against two facilities since January 2021.
“We don’t need additional state penalties,” she said.
Sen. Kevin Van Winkle, a Douglas County Republican and a co-sponsor of the bill, said the goal isn’t to punish hospitals, but to identify which ones need help and support them in complying.
“It would take months of willful negligence, really,” before hospitals would receive large fines, he said. “The last thing we want to do is punish a hospital that’s trying to do everything correctly.”
Matt Kelly, director of patient financial services at UCHealth, said the bill is redundant, and that patients don’t find posted price lists useful. UCHealth has a team dedicated to producing price estimates for any patient who asks for one, he said.
“It’s frustrating that we’re having to divert resources to files and lists,” he said.
Ilaria Santangelo, director of research at PatientRightsAdvocate.org, said patients don’t have any recourse if an estimate they received was off by hundreds or thousands of dollars. That makes access to the actual prices important when challenging an unexpected bill, she said.
Estimates vary widely on how well Colorado hospitals are complying with the existing price transparency rules. Mulready estimated about 90% were, while a report from PatientRightsAdvocate.org found only one out of 32 hospitals checked in August was fully compliant with price transparency. A state report released in March found about 27% of hospitals were fully compliant and about 47% met some of the requirements, but not others.
Ultimately, the health care market can’t work if patients and employers don’t know the prices they’re going to pay, said Anne Ladd, CEO of Peak Health Alliance, which negotiates with hospitals to lower health care costs in parts of the high country and Western Slope.
“We need to inject some competition into Colorado’s health care market,” she said.
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