AN ACT Relating to the collection and reporting of hospital financial, discharge, and charity care information; adding a new chapter to Title 70 RCW; creating a new section; prescribing penalties; and declaring an emergency.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION. Sec. 1. This chapter may be known and cited as the hospital data and charity care information act.

NEW SECTION. Sec. 2. The legislature finds and declares that there is a need for hospital information that helps the general public understand hospital care issues and how they can be better consumers and that is useful to purchasers, payors, and providers in making hospital care choices and negotiating payments. It is the purpose and intent of this chapter to establish a hospital data collection, storage, and retrieval system which supports these data needs and which also provides public officials and others engaged in the development of state health policy the information necessary for the analysis of hospital care issues.

The lack of reliable statistical information about the delivery of charity care is a particular concern that should be addressed. It is the purpose and intent of this chapter to require hospitals to provide, and report to the state, charity care to persons with acute care needs, and to have a state agency both monitor and report on the relative commitment of hospitals to the delivery of charity care services, as well as the relative commitment of public and private purchasers or payors to charity care funding.

NEW SECTION. Sec. 3. As used in this chapter the following terms have the meaning indicated unless the context clearly requires otherwise.

(1) "Hospital" means any health care institution which is required to qualify for a license under RCW 70.41.020(2) or as a psychiatric hospital under chapter 71.12 RCW.

(2) "Department" means the department of health if such a department is created by the legislature or otherwise the office of financial management.

(3) "Charity care" means necessary hospital health care rendered to indigent persons, to the extent that the persons are unable to pay for the care or to pay deductibles or co-insurance amounts required by a third-party payor, as determined by the department.

(4) "Sliding fee schedule" means a hospital-determined, publicly available schedule of discounts to charges for persons deemed eligible for charity care.

(5) "Special studies" means studies which have not been funded through the department's biennial or other legislative appropriations.

NEW SECTION. Sec. 4. (1) The department is responsible for the development, implementation, and custody of a state-wide hospital data system. As part of the design stage for development of the system, the department shall undertake a needs assessment of the types of, and format for, hospital data needed by consumers, purchasers, payors, hospitals, and state government as consistent with the intent of this chapter. The department shall identify a set of hospital data elements and report specifications which satisfy these needs. The department shall consult with the data advisory committee established by this chapter in designing the data system and may contract with a private vendor for assistance in the design of the data system. The data elements, specifications, and other design features of this data system shall be made available for public review and comment and shall be published, with comments, as the department's first data plan by January 1, 1990.

(2) Subsequent to the initial development of the data system as published as the department's first data plan, revisions to the data system shall be considered through the department's development of a biennial data plan, as proposed to, and funded by, the legislature through the biennial appropriations process. Costs of data activities outside of these data plans, except for special studies, shall be funded through legislative appropriations.

(3) In designing the state-wide hospital data system and any data plans, the department shall identify hospital data elements relating to both hospital finances and the use of services by patients. Data elements relating to hospital finances shall be reported by hospitals in conformance with a uniform system of reporting as specified by the department and shall include data elements identifying each hospital's revenues, expenses, contractual allowances, charity care, bad debt, other income, total units of inpatient and outpatient services, and other financial information reasonably necessary to fulfill the purposes of this chapter, for hospital activities as a whole and, as feasible and appropriate, for specified classes of hospital purchasers and payors. Data elements relating to use of hospital services by patients shall, at least initially, be the same as those currently compiled by hospitals through inpatient discharge abstracts and reported to the Washington state hospital commission.

(4) The state-wide hospital data system shall be uniform in its identification of reporting requirements for hospitals across the state to the extent that such uniformity is necessary to fulfill the purposes of this chapter. Data reporting requirements may reflect differences in hospital size; urban or rural location; scope, type, and method of providing service; financial structure; or other pertinent distinguishing factors. So far as possible, the data system shall be coordinated with any requirements of the federal department of health and human services in its administration of the medicare program and the state in its role of gathering public health statistics, so as to minimize any unduly burdensome reporting requirements imposed on hospitals.

(5) In identifying financial reporting requirements under the state-wide hospital data system, the department may require both annual reports and condensed quarterly reports, so as to achieve both accuracy and timeliness in reporting.

(6) In designing the initial state-wide hospital data system as published in the department's first data plan, the department shall review all existing systems of hospital financial and utilization reporting used in this state to determine their usefulness for the purposes of this chapter, including their potential usefulness as revised or simplified.

(7) Until such time as the state-wide hospital data system and first data plan are developed and implemented and hospitals are able to comply with reporting requirements, the department shall require hospitals to continue to submit the hospital financial and patient discharge information previously required to be submitted to the Washington state hospital commission. Upon publication of the first data plan, hospitals shall have a reasonable period of time to comply with any new reporting requirements and, even in the event that new reporting requirements differ greatly from past requirements, shall comply within two years of the effective date of this chapter.

(8) The hospital data collected and maintained by the department shall be available for retrieval in original or processed form to public and private requestors within a reasonable period of time after the date of request. The cost of retrieving data for state officials and agencies shall be funded through the state general appropriation. The cost of retrieving data for individuals and organizations engaged in research or private use of data shall be funded by a fee schedule developed by the department which reflects the direct cost of retrieving the data in the requested form.

NEW SECTION. Sec. 5. The department shall provide, or may contract with a private entity to provide, hospital analyses and reports consistent with the purposes of this chapter. These reports shall include:

(1) Consumer guides on purchasing hospital care services and publications providing verifiable and useful comparative information to consumers on hospitals and hospital services;

(2) Reports for use by classes of purchasers, payors, and providers as specified for content and format in the state-wide data system and data plan; and

(3) Reports on relevant hospital policy issues including the distribution of hospital charity care obligations among hospitals; absolute and relative rankings of Washington and other states, regions, and the nation with respect to expenses, net revenues, and other key indicators; hospital efficiencies; and the effect of medicare, medicaid, and other public health care programs on rates paid by other purchasers of hospital care.

NEW SECTION. Sec. 6. The department shall, by December 15 of each even-numbered year, submit to the fiscal and health committees of the senate and house of representatives a report covering total expenditures by state government over the past two years for the purchase or provision of health care services, together with an estimate of such future expenditures during the ensuing four years. The reports, together with any suitable recommendations, shall be consistent with the provisions of section 17, chapter 288, Laws of 1984 (uncodified).

The department shall serve as a clearinghouse for information concerning federal and state legislative initiatives affecting the private health care delivery system and governmental health care programs.

NEW SECTION. Sec. 7. The department shall have the authority to respond to requests of others for special studies or analysis. The department may require such sponsors to pay any or all of the reasonable costs associated with such requests that might be approved, but in no event may costs directly associated with any such special study be charged against the funds generated by the assessment authorized under section 10 of this act.

NEW SECTION. Sec. 8. (1) No hospital or its medical staff shall adopt or maintain admission practices or policies which result in:

(a) A significant reduction in the proportion of patients who have no third-party coverage and who are unable to pay for hospital services;

(b) A significant reduction in the proportion of individuals admitted for inpatient hospital services for which payment is, or is likely to be, less than the anticipated charges for or costs of such services; or

(c) The refusal to admit patients who would be expected to require unusually costly or prolonged treatment for reasons other than those related to the appropriateness of the care available at the hospital.

(2) No hospital which maintains an emergency department shall turn away, discharge, or transfer any person from the emergency department without performing an appropriate medical screening examination to determine if an emergency medical condition or active labor exists. If an emergency medical condition or active labor exists, the patient must be stabilized prior to any transfer unless the transfer is performed at the request of the patient or is due to the limited medical resources of the transferring hospital. Hospitals must follow reasonable procedures in making transfers to other hospitals including confirmation of acceptance of the transfer by the receiving hospital.

(3) The department shall develop definitions by rule, as appropriate, for subsection (1) of this section and, with reference to federal requirements, subsection (2) of this section. The department shall monitor hospital compliance with subsections (1) and (2) of this section. The department shall report to the legislature and the governor on hospital compliance with these requirements and shall report individual instances of possible noncompliance to the state attorney general or the appropriate federal agency.

(4) The department shall establish and maintain by rule, consistent with the definition of charity care in section 3 of this act, the following:

(a) Uniform procedures, data requirements, and criteria for identifying patients receiving charity care;

(b) A definition of residual bad debt including reasonable and uniform standards for collection procedures to be used in efforts to collect the unpaid portions of hospital charges that are the patient's responsibility.

(5) For the purpose of providing charity care, each hospital shall develop, implement, and maintain a charity care policy and a sliding fee schedule for determination of discounts from charges for persons who qualify for such discounts by January 1, 1990. Persons who may be eligible for charity care shall be notified by the hospital.

(6) Each hospital shall make every effort to determine the existence or nonexistence of private or public sponsorship which might cover in full or part the charges for care rendered by the hospital to a patient; the family income of the patient as classified under federal poverty income guidelines; and the eligibility of the patient for charity care as defined in this chapter and in accordance with hospital policy. This initial determination of sponsorship status shall precede collection efforts directed at the patient.

(7) The department shall monitor the distribution of charity care among hospitals, with reference to factors such as relative need for charity care in hospital service areas and trends in private and public health coverage. The department shall report to the legislature and executive any problems in distribution which are in contradiction of the intent of this chapter. The report shall include an assessment of the effects of the provisions of this chapter on access to hospital and health care services, as well as an evaluation of the contribution of all purchasers of care to hospital charity care.

(8) The department shall issue a report on the subjects addressed in this section at least annually, with the first report due on July 1, 1990.

NEW SECTION. Sec. 9. The department shall establish a data advisory committee composed of persons with significant technical expertise in the design and use of hospital data or data systems to advise the department on various data design and use issues. Membership shall include representatives from at least the following groups:

(1) Consumers;

(2) Business;

(3) Health care service contractors;

(4) Commercial insurers;

(5) Labor organizations;

(6) Government;

(7) Hospitals, including not-for-profit, proprietary, teaching, and public district hospitals; and

(8) Physicians.

In the formulation or review of any rules, policies, or procedures concerning charity care under section 8 of this act the department shall also consult with low-income persons as well as those most prominently engaged in meeting the health care needs of low-income persons.

NEW SECTION. Sec. 10. The basic expenses for the hospital data collection and reporting activities of this chapter shall be financed by an assessment against hospitals of no more than four one-hundredths of one percent of each hospital's gross operating costs, to be levied and collected from and after that date, upon which the similar assessment levied under chapter 70.39 RCW is terminated, but in no event later than July 1, 1990, for the provision of hospital services for its last fiscal year ending on or before June 30th of the preceding calendar year. Budgetary requirements in excess of that limit must be financed by a general fund appropriation by the legislature. The department may also charge, receive, and dispense funds or authorize any contractor or outside sponsor to charge for and reimburse the costs associated with special studies as specified in section 7 of this act.

NEW SECTION. Sec. 11. The department and any of its contractors or agents shall maintain the confidentiality of any information which may, in any manner, identify individual patients.

NEW SECTION. Sec. 12. Every person who violates or knowingly aids and abets the violation of this chapter or any valid orders or rules thereunder, or who fails to perform any act required under this chapter is guilty of a misdemeanor. Following official notice to the accused by the department or attorney general of the existence of an alleged violation, each day that a violation occurs shall constitute a separate violation. Any person violating the provisions of this chapter may be enjoined from continuing such violation. The department may levy civil penalties not exceeding one thousand dollars for violations of this chapter. The accused shall be entitled to an adjudicative proceeding and judicial review under chapter 34.05 RCW.

NEW SECTION. Sec. 13. If specific funding for the purposes of this act, referencing this act by bill number, is not provided by June 30, 1989, in the omnibus appropriations act, this act shall be null and void.

NEW SECTION. Sec. 14. Sections 1 through 12 of this act shall constitute a new chapter in Title 70 RCW.

NEW SECTION. Sec. 15. This act is necessary for the immediate preservation of the public peace, health, or safety, or support of the state government and its existing public institutions, and shall take effect immediately.