NY Coalition Proposes Nation’s First Cap on Hospital Clinic Bills

A broad coalition in New York is backing state legislation that would impose a first-in-the-nation cap on medical bills — aimed at hospitals that own or house outpatient clinics and that charge higher fees than private practices.

Under the Fair Prices Act, patient billing costs will be capped at 150% of federal Medicare program fees for procedures for the elderly.

A joint committee made up of the powerful construction workers union Local 32 BJ and an arm of the Real Estate Board of New York is funding a seven-figure media ad to build support for the bill.

“Two patients walk into their local doctor’s offices for the same procedure, but pay a very different price. This is happening all over New York because big hospitals are taking over independent doctors’ offices and driving up the cost of routine procedures,” the 30-second TV ad says.

“Health care should not cost more because a hospital owns the building. The same procedure should cost the same fair price.”

The ad – paid for by the 32BJ Labor Industry Trust Fund – gives examples showing glaring inequalities.

Currently, the bill for a child’s flu shot at a doctor’s office can be $23, but at a hospital clinic it’s $183, advocates say.

Administering IV fluids to an elderly patient in a doctor’s office is $566, less than half the $1,719 charged at a hospital-run outpatient clinic.

An MRI to check for stomach pain costs $1,308 at a hospital clinic, more than double the $659 at a doctor’s office.

Among the groups supporting the proposed law are the NAACP, the Hispanic Federation, the Asian American Federation and the NY Immigration Coalition.

“Major hospitals are treating routine medical services like a game of monopoly, where every time a patient walks into a building they own, a higher price is charged,” said Manny Pastreich, president of Local 32BJ of the International Union of Hospital Employees Service.

“Our members believe they will be able to go to their local doctor’s office to get their child a flu shot, get an MRI for a swollen knee or an IV bag for dehydration and not have to pay premiums swollen just because of a big shot. the hospital took over that facility.”

State Sen. Liz Krueger (D-Manhattan), who chairs the influential finance committee, just introduced the Fair Prices Act.

“We cannot allow the Big Hospitals to become the next Big Oil or Big Steel, with monopoly control over everything and people forced to pay more for the same basic procedure. By capping the cost of outpatient services through the Fair Pricing Act, we can level the playing field and ensure that patients have access to the same fair price wherever they go for their health care needs,” Krueger said.

In addition to the hard cap, the measure would prohibit the addition of facility fees to routine outpatient services, thereby preventing overpayments to hospitals for physician office services

State agencies — including the state attorney general — will enforce the limits and impose penalties for violating the law and “deceptive practices.”

Advocates said lower medical costs for patients and insurers such as state and local governments and union health funds will make medical care more affordable.

About 60% of physician practices are hospital or corporate owned, and nearly 80% of physicians are employees of hospitals or corporate entities, Local 32 BJ said.

The bill, if passed, would affect major hospital networks such as New York Presbyterian, Northwell and NYU Langone Health.

Hospital lobby group opposes “terrible bill.”

“Hospitals and doctors’ offices are not the same. Only hospitals offer 24/7 care and accept every patient that walks through their doors. Hospitals are also subject to countless regulatory requirements that physician offices are not,” said New York Hospital Association President Kenneth Raske.

Rakse said the bill “ignores” the financial pressures facing hospitals.

“Does 32BJ have a magic wand that will eliminate severe Medicaid underpayments and staggering rates of payment delays and denials by for-profit insurance companies?,” Raske asked.

“If the goal is to force New Yorkers to seek their care in Philadelphia, this bill would do that. Instead of pushing harmful public policy, the bill’s supporters should join the hospital community in fighting for higher Medicaid payment rates and curbing abusive practices by health insurance companies.