Two laws improve hospital reporting and price transparency to save Coloradans money
DENVER, CO - Governor Polis today signed two bipartisan bills into law to increase transparency in hospital reporting requirements and increase price transparency for health care services to save Colorado patients money.
"Colorado Democrats have been committed to making health care more affordable for Coloradans, and this new law will improve hospital transparency requirements so we can build future policies that save Coloradans money,” said Rep. Chris deGruy Kennedy, D-Lakewood, sponsor of HB23-1226. “Hospitals can move money around and between states, making it hard to know where profits are going and why the cost of care continues to increase faster than inflation. With this new law, we’ll have a more thorough understanding of Colorado hospitals’ cash flow so we can craft cost saving measures for patients and businesses.”
“In the communities I represent in Western Colorado, affordable health care can be too hard to come by or impossible to find,” said Senator Dylan Roberts, D-Avon, sponsor of HB23-1226. “I’m proud of our bipartisan bill to enhance hospital financial transparency reporting, increase compliance, and collect data that will give us the best information possible to help inform new policies to improve health care administration and save Coloradans money.”
HB23-1226, also sponsored by Republicans Senator Perry Will and Representative Matt Soper, builds off of hospital transparency legislation also carried by Representative Chris deGruy Kennedy in 2019 to bolster price transparency and reduce health care costs. Under HB23-1226, hospitals will have to disclose an annual summary of the hospital’s transfers of cash, equity, investments, or other assets to and from related parties, a hospital-specific statement of cash flow, a narrative report of capital investments greater than 25 million dollars, the salary and total compensation of the top 5 highest paid administrative positions of each nonprofit hospital, and more.
The transparency data will identify underlying drivers of high hospital costs and strengthen data collection on the financial health and performance of Colorado hospitals. The Department of Health Care Policy and Financing will have the power to apply corrective action plans or fines to hospitals that do not comply with data collection procedures. Hospitals will also be required to provide patients with a detailed list of billed services and the associated charges and disclose the patient’s right to receive more detailed information about the billed services.
“Coloradans deserve to know what their medical bills will look like before going into treatment or surgery,” said Senator Julie Gonzales, D-Denver, sponsor of SB23-252. “We’ve made great progress in our work to protect consumers and lower the costs of health care, but there’s still more we can do. It’s time to take the next step and increase medical price transparency so Coloradans aren’t blindsided with big bills after receiving care.”
“Price transparency for health care services is critical so Colorado patients aren’t blindsided by large hospital bills that they have no choice but to pay,” said Rep. Lindsey Daugherty, D-Arvada, sponsor of SB23-252. “This transparency law allows patients to budget for inpatient and outpatient care, surgery, and prescription drug costs so they can receive the care they need at a price they can expect. We’re building the federal transparency requirement into Colorado law, which will save patients money on health care.”
SB23-252 was also sponsored by Republicans Senator Kevin Van Winkle and Representative Anthony Hartsook. In 2022, the General Assembly passed legislation to prohibit hospitals from pursuing debt collection action against a patient if the hospital failed to comply with federal hospital price transparency laws during the patient’s treatment.
Under the federal Hospital Price Transparency Rule, hospitals must publicly post standard charges and provide an out-of-pocket cost estimator tool for patients. This bill builds on the federal transparency requirements by having hospitals post their Medicare reimbursement rates and requiring the Department of Health Care Policy and Financing to conduct performance assessments on Colorado hospitals to check for compliance. Any violation under SB23-252 is a deceptive trade practice under the Colorado Consumer Protection Act.