The legislation would limit prices and ban hospital facility fees for dozens of health services deemed safe to get in a doctor’s office.
State lawmakers are moving to cap prices for dozens of routine health care services, saving New Yorkers an estimated $1 billion annually.
New legislation sponsored by state Sen. Liz Krueger and Assemblymember Chantel Jackson is designed to eliminate massive price discrepancies between hospital-owned facilities and doctor’s offices for the same services.
“The affordability of health care shouldn’t depend on what building it’s delivered in,” Krueger, whose Manhattan district includes many of the city’s biggest hospitals, said in a statement. “We cannot let big hospitals become the next Big Oil or Big Steel, with monopoly control over everything and people forced to pay more for the same basic procedure.”
If passed, the “Fair Pricing Act” would prevent most types of health care facilities from charging more than 150 percent of the Medicare rate for a specified set of services, such as vaccinations, MRIs, chemotherapy infusions and IV hydration. Public, safety-net and rural hospitals and federally qualified health centers would be exempt.
The prices of those services can vary immensely, according to 2022 claims data from the health fund for building service workers union 32BJ, which worked on the legislation. A flu shot in a doctors office averaged $23, compared with over $183 in a hospital’s outpatient center, according to the data. An initial, one-hour chemotherapy infusion averaged $410 in an office setting but $2,650 in hospital-owned outpatient facilities.
“The data’s pretty damning,” Claire Brockbank, director of policy and strategy for union’s benefit funds, said in an interview.
The bill’s impact could be far-reaching: Brockbank said it was written to apply to New Yorkers on most kinds of insurance, as well as patients paying out of pocket.
More context: Such price variations have caught the attention of policymakers across the U.S., as hospitals increasingly buy up local medical practices and hike their prices, in part by tacking on a so-called “facility fee” intended to help cover overhead.
New Yorkers would have saved more than $1 billion in 2022 if select services performed in hospital settings were paid the commercial insurance rate for doctor’s offices, according to research presented at a conference on hospital prices hosted by the union’s health fund earlier this year.
Sens. Bill Cassidy (R-La.) and Maggie Hassan (D-N.H.) released a bipartisan plan earlier this month to cut Medicare payments to hospitals’ outpatient departments to the level paid to independent practices.
New York lawmakers appear to be leading the way among state legislators with the introduction of their site-neutral legislation.
The bill is likely to provoke the state’s powerful hospital industry, which lobbied heavily against a prior legislative effort to ban facility fees. By the time that bill passed in 2021, it had been watered down to apply only to preventive services and otherwise required that hospitals simply give patients advance written notice of any facility fees not covered by their insurance.
The hospital industry insists the higher rates and facility fees are justified because they are subject to more stringent safety requirements and typically care for more complex patients.
What’s next: Krueger and Jackson’s bill will be taken up when the state Legislature reconvenes in 2025.
New York lawmakers unveil ‘site-neutral’ bill to cap health care costs
politicopro.com
November 21, 2024 9:32 am
The legislation would limit prices and ban hospital facility fees for dozens of health services deemed safe to get in a doctor’s office.
State lawmakers are moving to cap prices for dozens of routine health care services, saving New Yorkers an estimated $1 billion annually.
New legislation sponsored by state Sen. Liz Krueger and Assemblymember Chantel Jackson is designed to eliminate massive price discrepancies between hospital-owned facilities and doctor’s offices for the same services.
“The affordability of health care shouldn’t depend on what building it’s delivered in,” Krueger, whose Manhattan district includes many of the city’s biggest hospitals, said in a statement. “We cannot let big hospitals become the next Big Oil or Big Steel, with monopoly control over everything and people forced to pay more for the same basic procedure.”
If passed, the “Fair Pricing Act” would prevent most types of health care facilities from charging more than 150 percent of the Medicare rate for a specified set of services, such as vaccinations, MRIs, chemotherapy infusions and IV hydration. Public, safety-net and rural hospitals and federally qualified health centers would be exempt.
The prices of those services can vary immensely, according to 2022 claims data from the health fund for building service workers union 32BJ, which worked on the legislation. A flu shot in a doctors office averaged $23, compared with over $183 in a hospital’s outpatient center, according to the data. An initial, one-hour chemotherapy infusion averaged $410 in an office setting but $2,650 in hospital-owned outpatient facilities.
“The data’s pretty damning,” Claire Brockbank, director of policy and strategy for union’s benefit funds, said in an interview.
The bill’s impact could be far-reaching: Brockbank said it was written to apply to New Yorkers on most kinds of insurance, as well as patients paying out of pocket.
More context: Such price variations have caught the attention of policymakers across the U.S., as hospitals increasingly buy up local medical practices and hike their prices, in part by tacking on a so-called “facility fee” intended to help cover overhead.
New Yorkers would have saved more than $1 billion in 2022 if select services performed in hospital settings were paid the commercial insurance rate for doctor’s offices, according to research presented at a conference on hospital prices hosted by the union’s health fund earlier this year.
Sens. Bill Cassidy (R-La.) and Maggie Hassan (D-N.H.) released a bipartisan plan earlier this month to cut Medicare payments to hospitals’ outpatient departments to the level paid to independent practices.
New York lawmakers appear to be leading the way among state legislators with the introduction of their site-neutral legislation.
The bill is likely to provoke the state’s powerful hospital industry, which lobbied heavily against a prior legislative effort to ban facility fees. By the time that bill passed in 2021, it had been watered down to apply only to preventive services and otherwise required that hospitals simply give patients advance written notice of any facility fees not covered by their insurance.
The hospital industry insists the higher rates and facility fees are justified because they are subject to more stringent safety requirements and typically care for more complex patients.
What’s next: Krueger and Jackson’s bill will be taken up when the state Legislature reconvenes in 2025.