Connecticut Attorney General Calls on Lawmakers to Address Antitrust Concerns Regarding Facility Fees

The Connecticut Attorney General has released a report asking lawmakers in the state to propose bills to address residents' concerns with facility fees they are being charged by physician practices owned by hospitals.

The report noted the Attorney General's office receives many complaints of "hospital-based billing," which enables hospitals that own physician practices and outpatient clinics to bill for a physician's "professional fee" as well as for the use of the office or facility. Because of this, a separate charge or "facility fee" is being assessed to patients who receive medical services in an office setting, according to the report.

The practice of charging a separate facility fee derives from the Medicare reimbursement policy that "incentivizes hospitals to purchase freestanding physicians' offices and clinics and convert them to hospital outpatient departments without changing their location or patient mix," according to the report.

The report highlighted the following common complaints to the Attorney General's office concerning facility fees:

• Patients were not informed there would be a facility fee in a timely manner, as to allow them to prepare for paying the fee or seek care from another provider.
• Patients were surprised when they received bills for additional facility fees after their date of service.
• Patients felt the facility fee "bore no relationship to the care they were provided."
• Receptionists at outpatient departments accepted co-pays from patients for professional services without disclosing there would be an additional facility fee. 

The report concluded Connecticut residents need to receive better and timelier notification of facility fees, and in order to do so, there needs to be a uniform legal standard on notification and price transparency within the state.

The Attorney General proposed two bills for the Connecticut General Assembly to consider enacting. The purpose of the first bill is to ensure residents "receive clear and easily understood notice when they will be charged a facility fee and a separate professional fee." The second proposed bill requires the Attorney General's office to be notified "of changes in business relationships of physician practices."

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