AB338: Bill Text

JPC:amn

2023 - 2024 LEGISLATURE

2023 Assembly BILL 338

June 30, 2023 - Introduced by Representatives Brooks, Rozar, Allen, Bodden, Brandtjen, Dittrich, Donovan, Duchow, Goeben, Green, Gundrum, Gustafson, Macco, Rettinger, Schraa, Shankland, Sortwell and Wichgers, cosponsored by Senators Felzkowski, Bradley, Hutton, Knodl, Larson, Nass, Stroebel and Wimberger. Referred to Committee on Health, Aging and Long-Term Care.

AB338,1,2 An Act to create 50.40 of the statutes; relating to: price transparency in hospitals and providing a penalty.

Analysis by the Legislative Reference Bureau

This bill creates several requirements for hospitals to provide cost information for certain items and services provided by the hospital. Under the bill, each hospital must make publicly available a digital file in a machine-readable format that contains a list of standard charges for certain items and services provided by the hospital and a consumer-friendly list of standard charges for certain shoppable services. “Standard charge” is defined to mean the regular rate established by the hospital for an item or service provided to a specific group of paying patients and includes certain price information, including the gross charge, the payor-specific negotiated charge, and the discounted cash price. “Shoppable service” is defined to mean a service that may be scheduled by a health care consumer in advance. If the Department of Health Services determines that a hospital is not in compliance with any of the price transparency requirements specified in the bill, the bill requires DHS to take certain actions, including providing a written notice to the hospital, requesting a corrective action plan from the hospital, or imposing a penalty. The bill establishes escalating penalties for violations of the hospital price transparency requirements specified in the bill based on the hospital's bed count, from $600 for each day in which a hospital with 30 beds or fewer violates the hospital price transparency requirements under the bill up to $10,000 for each day in which a hospital with greater than 550 beds violates the hospital price transparency requirements under the bill. The bill also requires DHS to maintain a publicly available list of hospitals that have been found to have violated any of the price transparency requirements specified in the bill.

Under the bill, the list of standard charges must be available at all times to the public in a machine-readable format, must be displayed in a prominent location on the home page of the hospital's website, and must include certain information, including a description of each hospital item or service provided and any code used by the hospital for purposes of accounting or billing. Further, the list of standard charges must meet certain criteria, including that it must be available free of charge and without having to establish a user account or password, that the list is available without having to submit personal identifying information, that the list is digitally searchable, and that the list is accessible to a commercial operator of an Internet search engine as necessary for the search engine to index the list and display the list as a result in response to a search query of a user of the search engine. The list of standard charges must be updated at least once each year.

Further, under the bill, the consumer-friendly list of standard charges for shoppable services must be publicly available and must contain standard charge information for each of at least 300 shoppable services provided by the hospital. The bill allows a hospital to select the shoppable services to be included in the list, except that the list must include either the 70 services specified as shoppable services by the federal Centers for Medicare and Medicaid Services (CMS) or, if the hospital does not provide all of the shoppable services specified by CMS, as many of the 70 services specified as shoppable services by CMS as the hospital provides. If a hospital does not provide at least 300 shoppable services, the bill requires the hospital to maintain a list of all shoppable services that the hospital provides. The consumer-friendly list of standard charges for shoppable services must include certain information, including certain price information and a plain-language description of each shoppable service included on the list, whether each hospital location provides the shoppable service and whether the standard charges included in the list apply at that location, and whether one or more of the shoppable services specified by CMS is not provided by the hospital. The consumer-friendly list of standard charges for shoppable services must meet certain criteria, including that the list is available free of charge without having to establish a user account or password, that the list is searchable by service description, billing code, and payor, and that the list is accessible to a common commercial operator of an Internet search engine as necessary for the search engine to index the list and display the list as a result in response to a search query of a user of the search engine. The consumer-friendly list of standard charges for shoppable services must be updated at least once each year.

The bill provides that every time a hospital updates the list of standard charges or the consumer-friendly list of standard charges for shoppable services, the hospital must submit the updated list to DHS. Under the bill, DHS must monitor each hospital's compliance with the price transparency requirements specified in the bill by evaluating complaints, reviewing any analysis prepared regarding noncompliance, auditing the websites of hospitals, or confirming that each hospital submitted the required lists.

For further information see the state fiscal estimate, which will be printed as an appendix to this bill.

The people of the state of Wisconsin, represented in senate and assembly, do enact as follows:

AB338,1 Section 1. 50.40 of the statutes is created to read:

AB338,3,2 50.40 Hospital price transparency. (1) Definitions. In this section:

AB338,3,4 (a) “Ancillary service” means a hospital item or service that a hospital customarily provides as part of a shoppable service.

AB338,3,6 (b) “Chargemaster” means the list of all hospital items or services maintained by a hospital for which the hospital has established a charge.

AB338,3,8 (c) “De-identified maximum negotiated charge” means the highest charge that a hospital has negotiated with all 3rd-party payors for a hospital item or service.

AB338,3,10 (d) “De-identified minimum negotiated charge” means the lowest charge that a hospital has negotiated with all 3rd-party payors for a hospital item or service.

AB338,3,12 (e) “Discounted cash price” means the charge that applies to an individual who pays cash, or a cash equivalent, for a hospital item or service.

AB338,3,14 (f) “Gross charge” means the charge for a hospital item or service that is reflected on a hospital's chargemaster, absent any discounts.

AB338,3,19 (g) “Hospital items or services” means all items and services, including individual items and services and service packages, that may be provided by a hospital to a patient in connection with an inpatient admission or an outpatient department visit for which the hospital has established a standard charge, including all of the following:

AB338,3,20 1. Supplies and procedures.

AB338,3,21 2. Room and board.

AB338,4,1 3. Use of the hospital and other areas.

AB338,4,3 4. Services of physicians and nonphysician practitioners employed by the hospital.

AB338,4,5 5. Any other item or service for which a hospital has established a standard charge.

AB338,4,8 (h) “Machine-readable format” means a digital representation of information in a file that can be imported or read into a computer system for further processing. “Machine-readable format” includes .XML, .JSON, and .CSV formats.

AB338,4,10 (i) “Payor-specific negotiated charge” means the charge that a hospital has negotiated with a 3rd-party payor for a hospital item or service.

AB338,4,12 (j) “Service package” means an aggregation of individual hospital items or services into a single service with a single charge.

AB338,4,14 (k) “Shoppable service” means a service that may be scheduled by a health care consumer in advance.

AB338,4,17 (L) “Standard charge” means the regular rate established by the hospital for a hospital item or service provided to a specific group of paying patients and includes all of the following:

AB338,4,18 1. The gross charge.

AB338,4,19 2. The payor-specific negotiated charge.

AB338,4,20 3. The de-identified minimum negotiated charge.

AB338,4,21 4. The de-identified maximum negotiated charge.

AB338,4,22 5. The discounted cash price.

AB338,4,24 (m) “Third-party payor” means an entity that is, by statute, contract, or agreement, legally responsible for payment of a claim for a hospital item or service.

AB338,5,2 (2) Public availability of price information required. A hospital shall make publicly available all of the following:

AB338,5,4 (a) A digital file in a machine-readable format that contains a list of all standard charges for all hospital items or services described under sub. (3).

AB338,5,6 (b) A consumer-friendly list of standard charges for a limited set of shoppable services as provided in sub. (4).

AB338,5,8 (3) List of standard charges required. (a) A hospital shall do all of the following:

AB338,5,10 1. Maintain a list of all standard charges for all hospital items or services in accordance with this section.

AB338,5,12 2. Ensure the list required under subd. 1. is available at all times to the public, including by posting the list electronically in the manner provided in this section.

AB338,5,16 (b) The standard charges contained in the list required to be maintained by a hospital under par. (a) 1. shall reflect the standard charges applicable to that location of the hospital, regardless of whether the hospital operates in more than one location or operates under the same license as another hospital.

AB338,5,18 (c) The list required under par. (a) 1. shall include all of the following information:

AB338,5,19 1. A description of each hospital item or service provided by the hospital.

AB338,5,21 2. The following charges for each individual hospital item or service when provided in either an inpatient setting or an outpatient department setting:

AB338,5,22 a. The gross charge.

AB338,5,23 b. The de-identified minimum negotiated charge.

AB338,5,24 c. The de-identified maximum negotiated charge.

AB338,5,25 d. The discounted cash price.

AB338,6,3 e. The payor-specific negotiated charge, listed by the name of the 3rd-party payor and plan associated with the charge and displayed in a manner that clearly associates the charge with each 3rd-party payor and plan.

AB338,6,7 3. Any code used by the hospital for purposes of accounting or billing for the hospital item or service, including the current procedural terminology code, the healthcare common procedure coding system code, the diagnosis related group code, the national drug code, or other common identifier.

AB338,6,9 (d) The information contained in the list required under par. (a) 1. shall be published in a single digital file that is in a machine-readable format.

AB338,6,15 (e) The list required under par. (a) 1. shall be displayed in a prominent location on the home page of the hospital's website or accessible by selecting a dedicated link that is prominently displayed on the hospital's website. If the hospital operates multiple locations and maintains a single website, the list required under par. (a) 1. shall be posted for each location the hospital operates in a manner that clearly associates the list with the applicable location of the hospital.

AB338,6,16 (f) The list required under par. (a) 1. shall satisfy all of the following criteria:

AB338,6,18 1. The list is available free of charge and without having to establish a user account or password.

AB338,6,20 2. The list is available without having to submit personal identifying information.

AB338,6,22 3. The list is available without having to overcome any other impediment, including entering a code.

AB338,6,25 4. The list is accessible to a common commercial operator of an Internet search engine to the extent necessary for the search engine to index the list and display the list as a result in response to a search query of a user of the search engine.

AB338,7,1 5. The list is formatted in a manner prescribed by the department.

AB338,7,2 6. The list is digitally searchable.

AB338,7,4 7. The list uses a naming convention specified by the federal centers for medicare and medicaid services.

AB338,7,6 (g) In prescribing the format of the list under par. (f) 5., the department shall do all of the following:

AB338,7,7 1. Develop a template for each hospital to use in formatting the list.

AB338,7,11 2. Consider any applicable federal guidelines for formatting similar lists required by federal law or rule and ensure that the design of the template enables health care researchers to compare the charges contained in the lists maintained by each hospital.

AB338,7,17 3. Design the template under subd. 1. to be substantially similar to the template used by the federal centers for medicare and medicaid services for purposes similar to the purposes of the list required under par. (a) 1. if the department determines that designing the template under subd. 1. to be substantially similar to the template used by the federal centers for medicare and medicaid services benefits the department.

AB338,7,20 (h) A hospital shall update the list required under par. (a) 1. at least once each year. The hospital shall clearly indicate the date on which the list was most recently updated, either on the list or in a manner that is clearly associated with the list.

AB338,8,5 (4) Consumer-friendly list of shoppable services. (a) Except as provided in par. (c), a hospital shall maintain and make publicly available a list of the standard charges described under sub. (3) (c) 2. b., c., d., and e. for each of at least 300 shoppable services provided by the hospital. The hospital may select the shoppable services to be included in the list, except that the list shall include either the 70 services specified as shoppable services by the federal centers for medicare and medicaid services or, if the hospital does not provide all of the shoppable services specified by the federal centers for medicare and medicaid services, as many of the 70 services specified as shoppable services by the federal centers for medicare and medicaid services as the hospital provides.

AB338,8,9 (b) In selecting a shoppable service for inclusion in the list, the hospital shall consider how frequently the hospital provides the services and the hospital's billing rate for the services and prioritize the selection of services that are among the services most frequently provided by the hospital.

AB338,8,12 (c) If a hospital does not provide at least 300 shoppable services, then the hospital shall maintain a list of all shoppable services that the hospital provides consistent with the requirements of this subsection.

AB338,8,13 (d) The list required under this subsection shall satisfy all of the following:

AB338,8,14 1. The list shall include the following information:

AB338,8,15 a. A plain-language description of each shoppable service included on the list.

AB338,8,19 b. The payor-specific negotiated charge that applies to each shoppable service included on the list and any ancillary service, listed by the name of the 3rd-party payor and plan associated with the negotiated charge and displayed in a manner that clearly associates the negotiated charge with the 3rd-party payor and plan.

AB338,8,23 c. The discounted cash price that applies to each shoppable service included on the list and any ancillary service or, if the hospital does not offer a discounted cash price for one or more of the shoppable services on the list or ancillary services, the gross charge for the shoppable service or ancillary service.

AB338,8,25 d. The de-identified minimum negotiated charge that applies to each shoppable service included on the list and any ancillary service.

AB338,9,2 e. The de-identified maximum negotiated charge that applies to each shoppable service included on the list and any ancillary service.

AB338,9,7 f. Any code used by the hospital for purposes of accounting or billing for each shoppable service included on the list and any ancillary service, including the current procedural terminology code, the healthcare common procedure coding system code, the diagnosis related group code, the national drug code, or other common identifier.

AB338,9,8 2. If applicable, the list shall do all of the following: