1) (Market Consolidation Review) These provisions expand state authority to review and modify proposed mergers and acquisitions in healthcare, including existing markets for consolidation.

a) Sample language:

i) The [STATE prosecuting authority] shall have jurisdiction to review, modify, and intervene in any proposed transaction resulting in change of ownership of a healthcare facility including a merger or acquisition.

ii) No healthcare transaction shall be completed until the [STATE prosecuting authority] has provided written approval of the transaction after all of the following have occurred:

(1) A notice of healthcare transaction has been filed with the [STATE prosecuting authority] in a form and manner prescribed by the [STATE prosecuting authority], which shall include at a minimum the following:

(a) The terms of the proposed transaction and copies of all transaction agreements between any of the parties;
(b) A list of the parties and their business addresses;
(c) A statement describing the proposed transaction and how it affects healthcare services in the region served; and
(d) A summary of any healthcare services currently provided and any modifications to those services.

(2) All costs and expenses associated with the review of the notice of healthcare transaction as established by the [STATE prosecuting authority] and published on the publicly accessible website have been paid in full; and

(3) Notice of the proposed transaction has been published on the [STATE prosecuting authority]’s publicly accessible website for at least ten days, and ten days have elapsed since providing the notice of proposed transaction to the relevant municipal and county officials and state legislators.

iii) Within 120 days of receiving a complete notice of proposed transaction, the [STATE prosecuting authority] shall complete a review including conferring with relevant state agencies and either:

(1) Approve the proposed transaction;
(2) Approve the proposed transaction with conditions; or
(3) Disapprove the proposed transaction.

iv) In determining whether to approve the proposed transaction, the [STATE prosecuting authority] shall consider all of the following:

(1) The potential reduction or elimination of essential services and the availability of quality healthcare services within the affected service area;
(2) The healthcare market share of a party to the transaction and whether the transaction may foreclose competitors of a party from a segment of the market;
(3) Changes in practice restrictions for healthcare providers; and
(4) Patient costs and the potential impact to health outcomes.

v) Penalties. A person who violates this section or an order, rule, or condition of approval issued under this section, may be assessed a fine of not more than $5,000 for each violation unless the violation is willful and intentional, in which case the fine shall not exceed $10,000 for each violation.

b) Examples include: Colorado, New Mexico

2) (Transparency and Accountability) These provisions require hospitals to disclose negotiated rates and total prices, ownership structure, and community benefit spending and ensure that only medical personnel make medical care decisions.

a) Sample language:

i) Transparency. A hospital shall publish each of the following on its publicly accessible website:

(1) A list of standard charges for all items and services as required by 45 C.F.R. § 180 as enacted in 2019 which shall be updated at least annually or at any point at which a cost is adjusted by more than 10 percent.
(2) For any nonprofit hospital, an annual report disclosing the amount and types of community benefits actually provided, including charity care. Charity care shall be reported separately from other community benefits. In reporting charity care, the hospital must report the actual cost of services provided, based on the total cost to charge ratio derived from the hospital’s Medicare cost report (CMS 2552-96 Worksheet C, Part 1, PPS Inpatient Ratios), not the charges for the services.

ii) Ownership disclosure. The [Department of Health or other relevant state agency hereinafter “department”] shall establish a procedure to gather the ownership information from all healthcare entities in a form, manner, and cadence as deemed necessary by the department no less than annually.

iii) All payor claims database. The department shall develop an all payor claims database wherein the data necessary to determine cost and effectiveness of healthcare shall be aggregated and securely made available to the public. The department shall promulgate rules and guidance to meet the requirements of this section.

iv) All information required to be published or disclosed pursuant to this section shall be provided in a machine-readable

v) An entity providing contracted management services for a professional medical entity or a shareholder, director, member, manager, officer, or employee of such organization shall not exercise de facto control over administrative, business or clinical operations of a professional medical entity in a manner that affects the professional medical entity’s clinical decision-making or the nature or quality of medical care that the professional medical entity delivers, which de facto control includes, but is not limited to, exercising ultimate decision-making authority over:

(1) Hiring or terminating, setting work schedules or compensation for, or otherwise specifying terms of employment of medical licensees;
(2) Setting clinical staffing levels, or specifying the period of time a medical licensee may see a patient, for any location that serves patients;
(3) Making diagnostic coding decisions;
(4) Setting clinical standards or policies; or
(5) Setting the prices, rates or amounts the professional medical entity charges for a medical licensee’s services.

b) Examples include: Arizona, Maine, Minnesota, New Mexico

3) (Facility Fee Limits) These provisions prohibit facility fees for telehealth and preventive care services and require disclosure of facility fees for any other services.

a) Sample language:

i) Facility fee transparency. No hospital, except an emergency department, shall charge a patient a facility fee unless the patient is provided with a notice including, at a minimum, the following information in a form and manner as determined by the [Department of Health or relevant state agency hereinafter “department”]:

(1) The actual amount or a good faith estimate of the amount which will be charged for the underlying care and for the facility fee;
(2) Contact information for financial assistance or charity care; and
(3) If applicable, contact information for a facility which will not charge a facility fee for the same care with the provider.

ii) The notice shall be provided in the language of the patient or their representative in written format either in person or electronically within five days of making the appointment and no less than 48 hours prior to receiving care.

iii) An emergency department of a hospital or emergency department connected to, or adjacent to, an urgent care center that charges a facility fee shall conspicuously post a sign at the entrance and in the waiting room stating that a facility fee may apply and providing the average fee amount.

iv) Limitation on facility fees. A healthcare entity shall not charge a facility fee for any preventative healthcare service or telehealth service.

v) Enforcement. It shall be a violation of [STATE Deceptive and Unfair Trade Practices Act] if any person charges, bills, or collects a facility fee or fails to comply with other provisions relating to facility fees in violation of this section.

b) Examples include: Colorado, Florida, Maryland, Oregon

4) (Site-Neutral Payment) These provisions can be used to broadly require that charges for similar core services be the same regardless of where they are performed.

a) Suggested language:

i) All healthcare providers that enter into a healthcare contract to be a participating provider with a health benefit plan must offer to accept as payment in full for all core services as defined by the [STATE Department of Health or other relevant department], rates that shall not exceed 150% of the amount paid as the Medicare non-hospital rate for those same services.

ii) No healthcare provider shall charge, bill, contract for, or accept payment for any core services that exceeds the lesser of:

(1) 150% of the amount paid by Medicare non-hospital rate; or
(2) The negotiated rate agreed upon by the healthcare provider and the health benefit plan.

iii) This provision applies for all individuals and entities that reimburse for core services, including self-pay individuals and health benefit plans that do not have an existing contract with the healthcare provider.

iv) No beneficiary or self-pay individual shall be liable to any healthcare provider for any amounts in excess of the rates set forth in this subdivision or for claims, charges, or bills prohibited by this subdivision, including any copayments, deductibles and/or coinsurance for any portion of such prohibited rates.

v) No health insurance carrier shall enter into a healthcare contract or reimburse a healthcare provider for any core services in amounts in excess of the rates set forth in this section or for claims, charges, or bills prohibited by this section.

b) Examples include: New York

5) (Nonprofit Hospital Standards) These provisions establish minimum free-care standards for nonprofit hospitals tied to the value of their tax exemption.

a) Sample language:

i) To qualify for a property tax exemption under this section, the nonprofit hospital or other healthcare related organization owning the property for which an exemption is sought shall:

(1) Demonstrate that its property is used exclusively for a charitable purpose; and

(a) Demonstrate that its net earnings and donations do not benefit a private shareholder or individual; or
(b) That the net earnings and profits of the entity irrevocably inure to the benefit of a nonprofit entity;

(2) Ensure availability of medical services regardless of ability to pay;
(3) Demonstrate that its policies reflect the public interest;
(4) Annually establish that its total gift to the community exceeds its tax liability for that year; and
(5) Demonstrate that tax exemptions extended to satellite healthcare facilities and centralized support facilities enhance and improve the nonprofit hospital’s or other healthcare-related organization’s mission.

ii) A nonprofit hospital or other healthcare-related organization shall annually establish and make a certified statement that its total gift to the community exceeds its tax liability by computing:

(1) The amount and value of the institution’s unreimbursed care to medically indigent persons or subsidized patients, as measured by computing the applicable Medicaid reimbursement rate for the professional or facility services provided to a medically indigent person or subsidized patient; and
(2) The tax liability for that year, as measured by computing the amount of property tax revenues that would be realized by assessing the hospital’s or other healthcare-related organization’s real property.

iii) In determining a nonprofit hospital’s or other healthcare-related organization’s total gift to the community, the following may not be included:

(1) The value of volunteer and community service rendered for and by the hospital or other healthcare-related organization;
(2) The value of volunteer assistance donated by an individual to a nonprofit hospital or other healthcare-related organization; or
(3) The value of monetary donations given to a nonprofit hospital or other healthcare-related organization.

b) Examples include: Utah, Illinois

6) (Reference-Based Pricing) These provisions limit what hospitals can charge for services to a percentage of Medicare rates.

a) Sample language:

i) A carrier that contracts to provide, to eligible public employees and their dependents, a benefit plan that reimburses the cost of inpatient or outpatient hospital services or supplies shall reimburse a claim for the cost of a hospital service or supply that is covered by, or is similar to a service or supply that is covered by, the Medicare program in an amount that does not exceed:

(1) For claims submitted by in-network hospitals, 200 percent of the amount paid by Medicare for the service or supply; or
(2) For claims submitted by out-of-network hospitals, 185 percent of the amount paid by Medicare for the service or supply.

ii) A provider who is reimbursed in accordance with this section may not charge to or collect from the patient or a person who is financially responsible for the patient an amount in addition to the reimbursement paid under this section other than cost sharing amounts authorized by the terms of the health benefit plan.

b) Examples include: Oregon, Washington, West Virginia

7) (Price Growth Caps) These provisions freeze hospital prices at their current rate and set limits to prevent escalating costs.

a) Sample language:

i) Any contract between a health insurer and a hospital licensed in [STATE] entered into, renewed, or amended on or after the effective date of this section, shall:

(1) Utilize unit-of-service payment methodologies for both inpatient and outpatient services that realign payment to provide incentives for efficient use of health services, and are derived from nationally utilized payment practices other than fee-for-service; and
(2) Include a quality incentive program which:

(a) Provides payment for attaining or exceeding mutually agreed-to, sufficiently challenging performance levels for all core measures for hospitals as determined by the [STATE Department of Health or other relevant department hereinafter “department”].
(b) Includes the measures, performance levels, payment levels, and payment mechanisms transparently in the contract; and
(c) Provides that quality incentive payments will not be due and payable until the quality incentive measure targets have been met or otherwise achieved by the hospital.

(3) Include a provision that agrees on rates and quality incentive payments for each contract year, and require that review and prior approval by the Office of the Health Insurance Commissioner shall be required if either:

(a) The average rate increase, including estimated quality incentive payments, is greater than the US All Urban Consumer All Items Less Food and Energy CPI (“CPIUrban”) percentage increase; or
(b) Such percentage increase shall be plus 1%, or less than twenty-five percent (25%) of the average rate increase is for expected quality incentive payments.

(4) Include terms that define the parties’ mutual obligations for greater administrative efficiencies, such as improvements in claims and eligibility verification processes, and identify commitments on the part of each; and
(5) Include terms that relinquish the right of either party to contest the public release, by state officials or the parties to the contract of the provisions of the contract; provided that the health insurer or other affected party may request the department to maintain specific contract terms or portions thereof as confidential, if properly supported with legal and factual analysis justifying the claim of confidentiality.

ii) To ensure compliance in the event of any hospital conversions, the health insurer shall, in terms of contracting, treat the contract of the successor hospital or entity as a continuation of the contract of the predecessor hospital or entity with whom the health insurer had contracted.

iii) Nothing in this section prevents contract terms that provide additional or stronger payment incentives toward quality and efficiency such as performance bonuses, bundled payments, global payments, or case rates.

b) Examples include: Rhode Island, Delaware