CHA Highlights Catastrophic Impacts of Facility Fee Legislation
GREENWOOD VILLAGE, COLO. – Feb. 23, 2023 – As introduced, House Bill 23-1215: Limit on Hospital Facility Fees would have catastrophic impacts on Colorado’s health care system. Colorado Hospital Association (CHA) and its member hospitals and health systems are raising the alarm about this legislation and its potential to harm patient access and health care affordability.
What is a facility fee?
Facility fees pay for outpatient care staff and support the broad variety of other staff and services necessary to provide world-class care. When a patient seeks outpatient care, they may be billed a professional fee, which pays for the doctor/provider, and a facility fee, which pays for all the other staff and resources necessary for providing that outpatient care.
Why do these fees matter?
Facility fees in outpatient settings have supported the shift to an integrated model of care that emphasizes preventive, whole-person care that is best for patients and ultimately saves money in the health care system. Colorado has made significant progress with this integrated model in recent years and is now a leader in the country for hospital cost savings and avoidable hospital usage.
What will this bill do?
This bill would prohibit facility fees – cutting all reimbursement for outpatient care provided by hospitals and making an integrated care model impossible. At a time when hospitals and health systems are facing significant financial challenges and more than half of Colorado hospitals have unsustainable finances, this bill would remove an additional $9 billion – or 25 percent of reimbursement – from the system. This would be immediately devastating for patients trying to access care across the state.
Specifically, hospitals have shared:
Children’s Hospital Colorado: “The bill introduced today would severely impact access to pediatric expertise for Colorado’s children,” said Jena Hausmann, president and CEO of Children’s Hospital Colorado. “These facility fees are the primary source of revenue to pay for our caregivers (nurses, pharmacists, behavior health specialists, social workers, interpreters, environmental services, food services and so many other valuable team members). Additionally, this includes medical and diagnostic equipment, technology and locations across Colorado that touch nearly every child who seeks medical care. If this legislation were to pass, we would have no option other than to significantly reduce and close many programs and services that our families trust and rely on being available for children. As a safety net provider for all children, Children’s Colorado will always be a voice defending their access to care. We strongly oppose this bill and will work closely with our primary care partners, patients and families, the business community and our vast network of community partners to educate bill sponsors, legislators and our community on the far-reaching implications of this legislation.”
Denver Health: “Hospitals are under tremendous financial strain,” said Steve Federico, MD, Denver Health chief government and community affairs officer. “We are concerned about any measure that negatively impacts the finances of the Denver health system and our ability to care for our patients.”
Lincoln Health (Hugo): “If we were prohibited from billing any facility fees we could not continue,” said Kevin Stansbury, Lincoln Health CEO. “We would be forced to close. If facility fees were limited for our primary care clinics only, we likely would have to close those clinics. It would not be economically feasible for us to continue.”
UCHealth: “The proposed legislation poses an alarming threat and significant impact to Coloradoans’ access to health care,” said Dr. Margaret Reidy, Chief Medical Officer, UCHealth. “Facility fees support the staff members who care for millions of patients each year in provider-based clinics, frequently with specialty care services – including transplant, neurology, cardiology, oncology, behavioral health services and more. Prohibiting this fee means there will be virtually no reimbursement for the nurses, nursing assistants, case managers, patient care technicians, pharmacists and many, many others who support care for patients. The unintended consequences of limiting the resources that support these services, including the thousands of professionals who provide them, will be devastating to patients. Notably, provider-based clinics often serve a high proportion of Medicaid, Medicare and uninsured patients, so these clinics are vital to some of Colorado’s most vulnerable communities. Much like we experienced during the pandemic, when patients don’t have access to preventative and outpatient care, their health care gets delayed and they are more likely to end up in the emergency department or being admitted to the hospital, with more severe health conditions, negatively impacting the patient and driving up health care costs.”
About Colorado Hospital Association
Colorado Hospital Association (CHA) is the leading voice of Colorado’s hospital and health system community. Representing more than 100 member hospitals and health systems throughout the state, CHA serves as a trusted, credible and reliable resource on health issues, hospital data and trends for its members, media, policymakers and the general public. Through CHA, Colorado’s hospitals and health systems work together in their shared commitment to improve health and health care in Colorado. Learn more at www.cha.com.