103RD GENERAL ASSEMBLY
State of Illinois
2023 and 2024
HB5517

 

Introduced 2/9/2024, by Rep. Jenn Ladisch Douglass

 

SYNOPSIS AS INTRODUCED:
 
See Index

    Creates the Protection Against Unnecessary Health Care Costs Act. Requires the State Comptroller to establish the Drug Discount Card Program to be made available for all residents of this State. Requires the Department of Insurance to report to the General Assembly and to the Governor recommendations for establishing an outreach and education program to inform licensed physicians on when a drug patent will expire and become available in generic form, and when generic alternatives exist for drugs whose patent recently expired. Provides that on and after October 1, 2025, a pharmaceutical manufacturer that employs an individual to perform the duties of a pharmaceutical sales representative shall register annually with the Department of Financial and Professional Regulation as a pharmaceutical marketing firm. Provides that each pharmaceutical marketing firm shall provide to the Department a list of all individuals employed by the pharmaceutical marketing firm as a pharmaceutical sales representative. Sets forth provisions concerning registration; registration fees; discipline of pharmaceutical marketing firms; the Department posting a list of all individuals employed by the pharmaceutical marketing firm as a pharmaceutical sales representative; and reports by pharmaceutical marketing firms to the Department. Requires the Department of Public Health to report to the General Assembly and the Governor, an analysis of pharmacy benefit managers' practices of prescription drug distribution. Requires the Department of Public Health to prepare a list of not more than 10 outpatient prescription drugs that the Director of Public Health, in the Director's discretion, determines are provided at substantial cost to the State or critical to public health. Requires the pharmaceutical manufacturer of an outpatient prescription drug included on that list to provide specified information to the Department of Public Health. Sets forth provisions concerning hearings; violations of the Act by health care facilities; civil penalties; and a report of the utilization management and provider payment practices of Medicare Advantage plans. Makes other changes. Amends the Illinois Health Facilities Planning Act. Requires a health care facility to post notice of its intent to file an application for a certificate of need. Effective immediately.


LRB103 38605 RPS 68741 b

 

 

A BILL FOR

 

HB5517LRB103 38605 RPS 68741 b

1    AN ACT concerning regulation.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 1. Short title. This Act may be cited as the
5Protection Against Unnecessary Health Care Costs Act.
 
6    Section 5. Drug Discount Card Program.
7    (a) In this Section, "volume discount contracting" means a
8negotiated purchase of a prescription drug in a large quantity
9for a decreased cost.
10    (b) The State Comptroller shall establish the Drug
11Discount Card Program to be made available for all residents
12of this State. To further the purpose of the program, the State
13Comptroller may cooperate with other states and territories of
14the United States, or regional consortia to pool prescription
15drug purchasing power to (1) lower prescription drug costs,
16(2) negotiate discounts with prescription drug manufacturers,
17(3) centralize the purchasing of prescription drugs, and (4)
18establish volume discount contracting.
19    (c) The State Comptroller shall study the feasibility of
20centralizing statewide contracts to consolidate the purchasing
21of prescription and physician-administered drugs by State
22agencies, State hospitals, State-operated community mental
23health centers, and other public entities, as necessary. The

 

 

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1study shall include an evaluation of (1) the potential cost
2savings, administrative feasibility, and other benefits and
3risks of centralizing and consolidating contracts, and (2) any
4additional staff and resources required by the State
5Comptroller to centrally procure and administer those
6contracts. Not later than November 1, 2026, each State agency,
7State hospital, community mental health center, and other
8public entity, as necessary, that procures prescription or
9physician-administered drugs shall provide information
10regarding the types, amount, and cost of those drugs to the
11State Comptroller, in a form and manner prescribed by the
12State Comptroller. Not later than February 1, 2027, the State
13Comptroller shall submit a report regarding the findings of
14the study to the Governor and the General Assembly.
 
15    Section 10. Physician outreach and education on drug
16patents. Not later than January 1, 2026, the Department of
17Insurance, in consultation with the Consumer Protection
18Division of the Office of the Attorney General, shall report
19to the General Assembly and to the Governor recommendations
20for establishing an outreach and education program to inform
21licensed physicians on: (1) when a drug patent will expire and
22become available in generic form; and (2) when generic
23alternatives exist for drugs whose patent recently expired.
 
24    Section 15. Definitions. For the purposes of this Section

 

 

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1through the Section immediately preceding Section 35:
2    "Contact" means any communication to promote or provide
3information relating to a legend drug that is transmitted in
4person or by telephone, email, text message, or other
5electronic means between a pharmaceutical representative and a
6prescribing practitioner or pharmacist.
7    "Department" means the Department of Financial and
8Professional Regulation.
9    "Legend drug" has the meaning given to that term in
10Section 3.23 of the Illinois Food, Drug and Cosmetic Act.
11    "Pharmaceutical manufacturer" means: (1) a person, whether
12within or outside the boundaries of the State, that produces,
13prepares, cultivates, grows, propagates, compounds, converts,
14or processes a drug, device, or cosmetic, directly or
15indirectly, by extraction from substances of natural origin,
16by means of chemical synthesis, or by a combination of
17extraction and chemical synthesis, or that packages,
18repackages, labels, or relabels a container under the
19manufacturer's own trademark or label or any other trademark
20or label, or a drug, device, or cosmetic for the purpose of
21selling the drug, device, or cosmetic, or (2) a sterile
22compounding pharmacy.
23    "Pharmaceutical manufacturer" includes a virtual
24manufacturer.
25    "Pharmaceutical marketing firm" means a pharmaceutical
26manufacturer that employs pharmaceutical representatives.

 

 

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1    "Pharmaceutical representative" means any person,
2including, but not limited to, a sales representative, who
3markets, promotes, or provides information regarding a legend
4drug for human use to a prescribing practitioner and is
5employed or compensated by a pharmaceutical manufacturer.
6    "Pharmacist" means an individual licensed to engage in the
7practice of pharmacy under the Pharmacy Practice Act or
8licensed to engage in the practice of pharmacy in another
9state.
10    "Prescribing practitioner" means an individual authorized
11by law to prescribe the usage of certain drugs for medical
12purposes.
13    "Secretary" means the Secretary of Financial and
14Professional Regulation.
15    "Tagline" means a short statement written in a non-English
16language that indicates the availability of language
17assistance services free of charge.
 
18    Section 20. Pharmaceutical marketing firm registration.
19    (a) On and after October 1, 2025, a pharmaceutical
20manufacturer that employs an individual to perform the duties
21of a pharmaceutical sales representative shall register
22annually with the Department of Financial and Professional
23Regulation as a pharmaceutical marketing firm, in a form and
24manner prescribed by the Department. No pharmaceutical
25manufacturer shall authorize an individual to perform such

 

 

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1duties on the manufacturer's behalf unless the manufacturer
2has obtained a registration from the Department pursuant to
3this Section. Registrations issued pursuant to this Section
4shall expire annually on June 30.
5    (b) The nonrefundable fee for registration as a
6pharmaceutical marketing firm and for annual renewal of that
7registration is $150. Any pharmaceutical marketing firm that
8fails to renew its registration on or before June 30 shall pay
9a late fee of $100 for each year that the pharmaceutical
10marketing firm did not renew, in addition to the annual
11renewal fee required under this Section.
12    (c) On the date of its initial registration, and annually
13thereafter, each pharmaceutical marketing firm shall provide
14to the Department a list of all individuals employed by the
15pharmaceutical marketing firm as a pharmaceutical sales
16representative. Each pharmaceutical marketing firm shall
17notify the Department, in a form and manner prescribed by the
18Department, of each individual who is no longer employed as a
19pharmaceutical sales representative or who was hired after the
20date on which the pharmaceutical marketing firm provided the
21annual list, not later than 2 weeks after the individual left
22employment or was hired.
23    (d) The Department shall prominently post on its website
24the most recent list provided by each pharmaceutical marketing
25firm pursuant to subsection (c) of this Section.
26    (e) Any person who is not identified to the Department

 

 

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1pursuant to subsection (c) of this Section shall not perform
2the duties of a pharmaceutical sales representative on behalf
3of the pharmaceutical marketing firm for any prescribing
4practitioner in this State.
5    (f) Not later than July 1, 2025, and annually thereafter,
6each pharmaceutical marketing firm shall provide the Secretary
7with the following information regarding the performance for
8the previous calendar year of each of its pharmaceutical sales
9representatives identified to the Department pursuant to
10subsection (c) of this Section at any time during the previous
11calendar year, in a form and manner prescribed by the
12Department:
13        (1) the aggregate number of contacts the
14    pharmaceutical sales representative had with prescribing
15    practitioners and pharmacists;
16        (2) the specialty of each prescribing practitioner and
17    pharmacist with whom the pharmaceutical sales
18    representative made contact;
19        (3) whether product samples, materials, or gifts of
20    any value were provided to a prescribing practitioner or
21    the practitioner's staff in a prescribing practitioner's
22    office or to a pharmacist; and
23        (4) an aggregate report of all free samples, by drug
24    name and strength, in a form and manner prescribed by the
25    Department.
26    (g) The Department shall annually analyze the information

 

 

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1submitted pursuant to this Section and compile a report on the
2activities and pharmaceutical representatives in the State.
3Not later than December 1, 2026, and annually thereafter, the
4Department shall post the report on its website and submit the
5report to the Governor and the General Assembly.
 
6    Section 25. Legend drug marketing. Each pharmaceutical
7representative engaged in legend drug marketing in this State
8shall disclose, in writing, to a prescribing practitioner or
9pharmacist, at the time of each contact with the prescribing
10practitioner or pharmacist, the following:
11        (1) the list price of a legend drug when the
12    pharmaceutical representative provides information
13    concerning the legend drug to the prescribing practitioner
14    or pharmacist based on the dose and quantity of the legend
15    drug as described in the medication package insert; and
16        (2) information on the variation efficacy of the
17    legend drug marketed to different racial and ethnic
18    groups, if that information is available.
 
19    Section 30. Discipline of pharmaceutical marketing firms.
20    (a) The Department may: (1) refuse to authorize the
21issuance or renewal of a registration to operate as a
22pharmaceutical marketing firm; (2) revoke, suspend, or place
23conditions on a registration to operate as a pharmaceutical
24marketing firm; and (3) assess a penalty of up to $1,000 for

 

 

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1each violation of any provision of Section 20 or 25, or take
2other action permitted by law, if the applicant or holder of
3the registration fails to comply with the requirements set
4forth in Section 20 or 25.
5    (b) The Department may adopt rules as necessary to
6implement this Section.
 
7    Section 35. Report of pharmacy benefit managers'
8practices. Not later than January 1, 2026, the Department of
9Public Health, in consultation with the Department of
10Insurance, shall report to the General Assembly and the
11Governor, its analysis of pharmacy benefit managers' practices
12of prescription drug distribution, including, but not limited
13to, spread pricing arrangements, manufacturing rebates and
14transparency, fees charged, financial incentives for adding
15drugs to health plan formularies and an evaluation of
16prescription drug distribution practices conducted by pharmacy
17benefit managers in other states. The report shall provide
18recommendations (1) to reduce prescription drug costs for
19consumers, and (2) for the regulation of pharmacy benefit
20managers in this State.
 
21    Section 40. List of outpatient prescription drugs.
22    (a) On or before January 1, 2025, and annually thereafter,
23the Director of Public Health, in consultation with the State
24Comptroller and the Department of Insurance, shall prepare a

 

 

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1list of not more than 10 outpatient prescription drugs that
2the Director of Public Health, in the Director of Public
3Health's discretion, determines are (A) provided at
4substantial cost to the State, considering the net cost of
5such drugs, or (B) critical to public health. The list shall
6include outpatient prescription drugs from different
7therapeutic classes of outpatient prescription drugs and not
8less than one generic outpatient prescription drug.
9    (b) Prior to publishing the annual list pursuant to
10subsection (a) of this Section, the Director of Public Health
11shall prepare a preliminary list that includes outpatient
12prescription drugs that the Director of Public Health plans to
13include on the annual list. The Director of Public Health
14shall make the preliminary list available for public comment
15for not less than 30 days. During the public comment period,
16any manufacturer of an outpatient prescription drug included
17on the preliminary list may produce documentation, as
18permitted by federal law, to the Director of Public Health to
19establish that the wholesale acquisition cost of such drug,
20less all rebates paid to the State for that outpatient
21prescription drug during the immediately preceding calendar
22year, does not exceed the limits established in subsection (c)
23of this Section. If the documentation establishes, to the
24satisfaction of the Director of Public Health, that the
25wholesale acquisition cost of the drug, less all rebates paid
26to the State for that drug during the immediately preceding

 

 

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1calendar year, does not exceed the limits established in
2subsection (c) of this Section, the Director of Public Health
3shall, not later than 15 days after the closing of public
4comment, remove that drug from the preliminary list before
5publishing the annual list pursuant to subsection (a) of this
6Section.
7    (c) The Director of Public Health shall not list any
8outpatient prescription drugs under subsection (a) or (b) of
9this Section unless the wholesale acquisition cost of that
10outpatient prescription drug (A) increased by not less than
1116% cumulatively during the immediately preceding 2 calendar
12years, and (B) was not less than $40 for a course of treatment.
13    (d)(1) The pharmaceutical manufacturer of an outpatient
14prescription drug included on a list prepared by the Director
15of Public Health pursuant to subsection (a) of this Section
16shall provide to the Department of Public Health, in a form and
17manner specified by the Director of Public Health, (i) a
18written, narrative description, suitable for public release,
19of all factors that caused the increase in the wholesale
20acquisition cost of the listed outpatient prescription drug,
21and (ii) aggregate, company-level research and development
22costs and such other capital expenditures that the Director of
23Public Health, in the Director of Public Health's discretion,
24deems relevant for the most recent year for which final
25audited data are available.
26    (2) The quality and types of information and data that a

 

 

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1pharmaceutical manufacturer submits to the office under this
2subsection shall be consistent with the quality and types of
3information and data that the pharmaceutical manufacturer
4includes in (i) the pharmaceutical manufacturer's annual
5consolidated report on Securities and Exchange Commission Form
610-K, or (ii) any other public disclosure.
7    (e) The Department of Public Health shall establish a
8standardized form for reporting information and data pursuant
9to this Section after consulting with pharmaceutical
10manufacturers. The form shall be designed to minimize the
11administrative burden and cost of reporting on the office and
12pharmaceutical manufacturers.
 
13    Section 45. Hospital facility fees.
14    (a) As used in this Section:
15    "Affiliated provider" means a provider that is: (1)
16employed by a hospital or health system; (2) under a
17professional services agreement with a hospital or health
18system that permits the hospital or health system to bill on
19behalf of such provider; or (3) a clinical faculty member of a
20medical school that is affiliated with a hospital or health
21system in a manner that permits the hospital or health system
22to bill on behalf of the clinical faculty member.
23    "Campus" means: (1) the physical area immediately adjacent
24to a hospital's main buildings and other areas and structures
25that are not strictly contiguous to the main buildings but are

 

 

HB5517- 12 -LRB103 38605 RPS 68741 b

1located within 250 yards of the main buildings; or (2) any
2other area that has been determined on an individual case
3basis by the Department of Public Health, the Department of
4Human Services, or other State agency to be a part of a
5hospital's campus.
6    "Facility fee" means any fee charged or billed by a
7hospital or health system for outpatient services provided in
8a hospital-based facility that is: (1) intended to compensate
9the hospital or health system for the operational expenses of
10the hospital or health system; and (2) separate and distinct
11from a professional fee.
12    "Health care provider" means an individual, entity,
13corporation, person or organization, whether for-profit or
14not-for-profit, that furnishes bills or is paid for health
15care service delivery in the normal course of business,
16including, but not limited to, a health system, a hospital, a
17hospital-based facility, a freestanding emergency department
18and an urgent care center.
19    "Health system" means: (1) a parent corporation of one or
20more hospitals and any entity affiliated with such parent
21corporation through ownership, governance, membership, or
22other means; or (2) a hospital and any entity affiliated with
23the hospital through ownership, governance, membership, or
24other means.
25    "Hospital" means an institution, place, building, or
26agency located in this State that is licensed as a general

 

 

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1acute hospital by the Department of Public Health under the
2Hospital Licensing Act, whether public or private and whether
3organized for profit or not-for-profit.
4    "Hospital-based facility" means a facility that is owned
5or operated, in whole or in part, by a hospital or health
6system where hospital or professional medical services are
7provided.
8    "Medicaid" means the federal medical assistance program
9established under Title XIX of the Social Security Act.
10    "Observation" means services furnished by a hospital on
11the hospital's campus, regardless of the length of stay,
12including use of a bed and periodic monitoring by the
13hospital's nursing or other staff to evaluate an outpatient's
14condition or determine the need for admission to the hospital
15as an inpatient.
16    "Payer mix" means the proportion of different sources of
17payment received by a hospital or health system, including,
18but not limited to, Medicare, Medicaid, other
19government-provided insurance, private insurance, and self-pay
20patients.
21    "Professional fee" means any fee charged or billed by a
22provider for professional medical services provided in a
23hospital-based facility.
24    "Provider" means an individual, entity, corporation, or
25health care provider, whether for profit or not-for-profit,
26whose primary purpose is to provide professional medical

 

 

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1services.
2    (b) If a hospital or health system charges a facility fee
3using a current procedural terminology evaluation (CPT E/M)
4code or assessment and management (CPT A/M) code for
5outpatient services provided at a hospital-based facility
6where a professional fee is also expected to be charged, the
7hospital or health system shall provide the patient with a
8written notice that includes the following information:
9        (1) that the hospital-based facility is part of a
10    hospital or health system and that the hospital or health
11    system charges a facility fee that is in addition to and
12    separate from the professional fee charged by the
13    provider;
14        (2)(A) the amount of the patient's potential financial
15    liability, including any facility fee likely to be
16    charged, and, where professional medical services are
17    provided by an affiliated provider, any professional fee
18    likely to be charged, or, if the exact type and extent of
19    the professional medical services needed are not known or
20    the terms of a patient's health insurance coverage are not
21    known with reasonable certainty, an estimate of the
22    patient's financial liability based on typical or average
23    charges for visits to the hospital-based facility,
24    including the facility fee, (B) a statement that the
25    patient's actual financial liability will depend on the
26    professional medical services actually provided to the

 

 

HB5517- 15 -LRB103 38605 RPS 68741 b

1    patient, (C) an explanation that the patient may incur
2    financial liability that is greater than the patient would
3    incur if the professional medical services were not
4    provided by a hospital-based facility, and (D) a telephone
5    number the patient may call for additional information
6    regarding the patient's potential financial liability,
7    including an estimate of the facility fee likely to be
8    charged based on the scheduled professional medical
9    services; and
10        (3) that a patient covered by a health insurance
11    policy should contact the health insurer for additional
12    information regarding the hospital's or health system's
13    charges and fees, including the patient's potential
14    financial liability, if any, for such charges and fees.
15    (c) If a hospital or health system charges a facility fee
16without using a current procedural terminology evaluation and
17management (CPT E/M) code for outpatient services provided at
18a hospital-based facility, located outside of the hospital
19campus, the hospital or health system shall provide the
20patient with a written notice that includes the following
21information:
22        (1) that the hospital-based facility is part of a
23    hospital or health system and that the hospital or health
24    system charges a facility fee that may be in addition to
25    and separate from the professional fee charged by a
26    provider:

 

 

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1        (2)(A) a statement that the patient's actual financial
2    liability will depend on the professional medical services
3    actually provided to the patient, (B) an explanation that
4    the patient may incur financial liability that is greater
5    than the patient would incur if the hospital-based
6    facility was not hospital-based, and (C) a telephone
7    number the patient may call for additional information
8    regarding the patient's potential financial liability,
9    including an estimate of the facility fee likely to be
10    charged based on the scheduled professional medical
11    services; and
12        (3) that a patient covered by a health insurance
13    policy should contact the health insurer for additional
14    information regarding the hospital's or health system's
15    charges and fees, including the patient's potential
16    financial liability, if any, for such charges and fees.
17    (d) Each initial billing statement that includes a
18facility fee shall: (1) clearly identify the fee as a facility
19fee that is billed in addition to, or separately from, any
20professional fee billed by the provider; (2) provide the
21corresponding Medicare facility fee reimbursement rate for the
22same service as a comparison or, if there is no corresponding
23Medicare facility fee for such service, (A) the approximate
24amount Medicare would have paid the hospital for the facility
25fee on the billing statement, or (B) the percentage of the
26hospital's charges that Medicare would have paid the hospital

 

 

HB5517- 17 -LRB103 38605 RPS 68741 b

1for the facility fee; (3) include a statement that the
2facility fee is intended to cover the hospital's or health
3system's operational expenses; (4) inform the patient that the
4patient's financial liability may have been less if the
5services had been provided at a facility not owned or operated
6by the hospital or health system; and (5) include written
7notice of the patient's right to request a reduction in the
8facility fee or any other portion of the bill and a telephone
9number that the patient may use to request such a reduction
10without regard to whether such patient qualifies for, or is
11likely to be granted, any reduction. Not later than January 1,
122025, and annually thereafter, each hospital, health system,
13and hospital-based facility shall submit to the Department of
14Public Health a sample of a billing statement issued by the
15hospital, health system, or hospital-based facility that
16complies with this subsection and that represents the format
17of billing statements received by patients. The billing
18statement shall not contain patient identifying information.
19    (e) The written notice described in subsections (b), (c),
20(d), (h), (i), and (j) of this Section shall be in plain
21language and in a form that may be reasonably understood by a
22patient who does not possess special knowledge regarding
23hospital or health system facility fee charges. On and after
24January 1, 2025, the written notices shall include taglines in
25at least the top 15 languages spoken in the State indicating
26that the notice is available in each of those languages.

 

 

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1    (f)(1) For nonemergency care, if a patient's appointment
2is scheduled to occur 10 or more days after the appointment is
3made, written notice shall be sent to the patient by
4first-class mail, encrypted email, or a secure patient
5Internet portal not less than 3 days after the appointment is
6made. If an appointment is scheduled to occur less than 10 days
7after the appointment is made or if the patient arrives
8without an appointment, notice shall be hand-delivered to the
9patient when the patient arrives at the hospital-based
10facility.
11    (2) For emergency care, written notice shall be provided
12to the patient as soon as practicable after the patient is
13stabilized in accordance with the federal Emergency Medical
14Treatment and Active Labor Act, 42 U.S.C. 1395dd, or is
15determined not to have an emergency medical condition and
16before the patient leaves the hospital-based facility. If the
17patient is unconscious, under great duress, or for any other
18reason unable to read the notice and understand and act on the
19patient's rights, the notice shall be provided to the
20patient's representative as soon as practicable.
21    (g) Subsections (b), (c), (d), (e), (f), and (l) of this
22Section do not apply if a patient is insured by Medicare or
23Medicaid.
24    (h) A hospital-based facility shall prominently display
25written notice in locations that are readily accessible to and
26visible by patients, including patient waiting or appointment

 

 

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1check-in areas, stating: (1) that the hospital-based facility
2is part of a hospital or health system; (2) the name of the
3hospital or health system; and (3) that if the hospital-based
4facility charges a facility fee, the patient may incur a
5financial liability greater than the patient would incur if
6the hospital-based facility was not hospital-based. On and
7after January 1, 2025, such notices shall include tag lines in
8at least the top 15 languages spoken in the State indicating
9that the notice is available in each of those top 15 languages.
10Not later than January 1, 2025, and annually thereafter, each
11hospital-based facility shall submit a copy of the written
12notice required by this subsection to the Department of Public
13Health.
14    (i) A hospital-based facility shall clearly hold itself
15out to the public and payers as being hospital-based,
16including, at a minimum, by stating the name of the hospital or
17health system in its signage, marketing materials, websites,
18and stationery.
19    (j) A hospital-based facility shall, when scheduling
20services for which a facility fee may be charged, inform the
21patient: (1) that the hospital-based facility is part of a
22hospital or health system; (2) of the name of the hospital or
23health system; (3) that the hospital or health system may
24charge a facility fee in addition to and separate from the
25professional fee charged by the provider; and (4) of the
26telephone number the patient may call for additional

 

 

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1information regarding such patient's potential financial
2liability.
3    (k)(1) If any business transaction results in the
4establishment of a hospital-based facility at which facility
5fees may be billed, where such a hospital-based facility did
6not previously exist, the purchaser in such transaction shall,
7not later than 30 days after such transaction, provide written
8notice, by first-class mail, of the transaction to each
9patient served within the 3 years preceding the date of the
10transaction by the health care facility that has been
11purchased as part of the transaction.
12    (2) Such notice shall include the following information:
13        (A) A statement that the health care facility is now a
14    hospital-based facility and is part of a hospital or
15    health system, the health care facility's full legal and
16    business name and the date of such facility's acquisition
17    by a hospital or health system.
18        (B) The name, business address, and phone number of
19    the hospital or health system that is the purchaser of the
20    health care facility.
21        (C) A statement that the hospital-based facility
22    bills, or is likely to bill, patients a facility fee that
23    may be in addition to, and separate from, any professional
24    fee billed by a health care provider at the hospital-based
25    facility.
26        (D) A statement that the patient's actual financial

 

 

HB5517- 21 -LRB103 38605 RPS 68741 b

1    liability will depend on the professional medical services
2    actually provided to the patient, and an explanation that
3    the patient may incur financial liability that is greater
4    than the patient would incur if the hospital-based
5    facility were not a hospital-based facility.
6        (E) The estimated amount or range of amounts the
7    hospital-based facility may bill for a facility fee or an
8    example of the average facility fee billed at the
9    hospital-based facility for the most common services
10    provided at the hospital-based facility.
11        (F) A statement that, prior to seeking services at the
12    hospital-based facility, a patient covered by a health
13    insurance policy should contact the patient's health
14    insurer for additional information regarding the
15    hospital-based facility fees, including the patient's
16    potential and financial liability, if any, for those
17    hospital-based facility fees.
18    (3) A copy of the written notice provided to patients in
19accordance with this subsection shall be filed with the
20Department of Insurance. A link to copies of these written
21notices shall be conspicuously available on the Department's
22website.
23    (4) A hospital, health system or hospital-based facility
24shall not collect a facility fee for services provided at a
25hospital-based facility that is subject to this subsection
26from the date of transaction until at least 30 days after the

 

 

HB5517- 22 -LRB103 38605 RPS 68741 b

1written notice required pursuant to this subsection is mailed
2to the patient or a copy of such notice is filed with the
3Department of Public Health, whichever is later. A violation
4of this subsection is a deceptive business practice under the
5Consumer Fraud and Deceptive Business Practices Act.
6    (5) Not later than July 1, 2025, and annually thereafter,
7each hospital-based facility that was the subject of a
8transaction, as described in paragraph (1) of this subsection,
9during the preceding calendar year shall report to the
10Department of Insurance the number of patients served by the
11hospital-based facility in the preceding 3 years.
12    (l)(1) Notwithstanding any other provision of this
13Section, no hospital, health system, or hospital-based
14facility shall collect a facility fee for (A) outpatient
15health care services that use a current procedural terminology
16evaluation and management (CPT E/M) code or assessment and
17management (CPT A/M) code and are provided at a hospital-based
18facility located off-site from a hospital campus, or (B)
19outpatient health care services provided at a hospital-based
20facility located off-site from a hospital campus received by a
21patient who is uninsured of more than the Medicare rate.
22    (2) Notwithstanding any other provision of this Section,
23on and after July 1, 2025, no hospital or health system shall
24collect a facility fee for outpatient health care services
25that use a current procedural terminology evaluation and
26management (CPT E/M) code or assessment and management (CPT

 

 

HB5517- 23 -LRB103 38605 RPS 68741 b

1A/M) code and are provided on the hospital campus. The
2provisions of this paragraph do not apply to (A) an emergency
3department located on a hospital campus, or (B) observation
4stays on a hospital campus and (CPT E/M) and (CPT A/M) codes
5when billed for the following services: (i) wound care, (ii)
6orthopedics, (iii) anticoagulation, (iv) oncology, (v)
7obstetrics, and (vi) solid organ transplant.
8    (3) Notwithstanding the provisions of paragraphs (1) and
9(2) of this subsection, in circumstances when an insurance
10contract that was in effect on or after July 1, 2025, provides
11reimbursement for facility fees prohibited under the
12provisions of paragraph (1) of this subsection, and in
13circumstances when an insurance contract that is in effect on
14July 1, 2025, provides reimbursement for facility fees
15prohibited under the provisions of paragraph (2) of this
16subsection, a hospital or health system may continue to
17collect reimbursement from the health insurer for such
18facility fees until the applicable date of expiration,
19renewal, or amendment of such contract, whichever date is
20earliest.
21    (4) The provisions of this subsection do not apply to a
22freestanding emergency department. As used in this paragraph,
23"freestanding emergency department" means a freestanding
24facility that (A) is structurally separate and distinct from a
25hospital, (B) provides emergency care, (C) is a department of
26a hospital licensed under Hospital Licensing Act, and (D) has

 

 

HB5517- 24 -LRB103 38605 RPS 68741 b

1been issued a certificate of need to operate as a freestanding
2emergency department by the Health Facilities and Services
3Review Board by showing the need for such a department in the
4geographic area where the facility is situated.
5    (5)(A) On and after July 1, 2025, if the Director of Public
6Health receives information and has a reasonable belief, after
7evaluating such information, that any hospital, health system,
8or hospital-based facility charged facility fees, other than
9through isolated clerical or electronic billing errors, in
10violation of any provision of this Section, or rule adopted
11thereunder, such hospital, health system, or hospital-based
12facility shall be subject to a civil penalty of up to $1,000.
13The Director of Public Health may issue a notice of violation
14and civil penalty by first-class mail or personal service.
15Such notice shall include: (i) a reference to the Section of
16the statutes, rule, or Section of the rules alleged to have
17been violated; (ii) a short and plain language statement of
18the matters asserted or charged; (iii) a description of the
19activity to cease; (iv) a statement of the amount of the civil
20penalty or penalties that may be imposed; (v) a statement
21concerning the right to a hearing; and (vi) a statement that
22the hospital, health system, or hospital-based facility may,
23not later than 10 business days after receipt of the notice,
24make a request for a hearing on the matters asserted.
25    (B) The hospital, health system, or hospital-based
26facility to whom notice is provided pursuant to subparagraph

 

 

HB5517- 25 -LRB103 38605 RPS 68741 b

1(A) of this paragraph (5) may, not later than 10 business days
2after receipt of such notice, make written application to the
3Department of Public Health to request a hearing to
4demonstrate that such violation did not occur. The failure to
5make a timely request for a hearing shall result in the
6issuance of a cease and desist order or civil penalty. All
7hearings held under this subsection shall be conducted in
8accordance with Illinois Administrative Procedure Act.
9    (C) Following any hearing pursuant to this paragraph, if
10the Department of Public Health finds, by a preponderance of
11the evidence, that the hospital, health system, or
12hospital-based facility violated or is violating any provision
13of this subsection, any rule adopted thereunder, or any order
14issued by the Department of Public Health, the Department of
15Public Health shall issue a final cease and desist order in
16addition to any civil penalty the Department of Public Health
17imposes.
18    (m)(1) Each hospital and health system shall report not
19later than November 1, 2025, and thereafter not later than
20July 1, 2026, and annually thereafter, to the Director of
21Public Health, on a form prescribed by the Department of
22Public Health, concerning facility fees charged or billed
23during the preceding calendar year. The report shall include,
24but need not be limited to: (A) the name and address of each
25facility owned or operated by the hospital or health system
26that provides services for which a facility fee is charged or

 

 

HB5517- 26 -LRB103 38605 RPS 68741 b

1billed, and an indication as to whether each facility is
2located on or outside of the hospital or health system campus;
3(B) the number of patient visits at each such facility for
4which a facility fee was charged or billed; (C) the number,
5total amount, and range of allowable facility fees paid at
6each such facility disaggregated by payer mix; (D) for each
7facility, the total amount of facility fees charged and the
8total amount of revenue received by the hospital or health
9system derived from facility fees, (E) the total amount of
10facility fees charged and the total amount of revenue received
11by the hospital or health system from all facilities derived
12from facility fees; (F) a description of the 10 procedures or
13services that generated the greatest amount of facility fee
14gross revenue, disaggregated by current procedural terminology
15category (CPT) code for each such procedure or service and,
16for each such procedure or service, patient volume and the
17total amount of gross and net revenue received by the hospital
18or health system derived from facility fees, disaggregated by
19on-campus and off-campus; and (G) the top 10 procedures or
20services for which facility fees are charged based on patient
21volume and the gross and net revenue received by the hospital
22or health system for each such procedure or service,
23disaggregated by on-campus and off-campus. For purposes of
24this subsection, "facility" means a hospital-based facility
25that is located on a hospital campus or outside a hospital
26campus.

 

 

HB5517- 27 -LRB103 38605 RPS 68741 b

1    (2) The Department of Public Health shall publish the
2information reported pursuant to paragraph (1) of this
3subsection or post a link to such information on the
4Department of Public Health's website.
 
5    Section 50. Hearings.
6    (a) The Director of Public Health, or any agent authorized
7by the Director of Public Health to conduct any inquiry,
8investigation, or hearing under this Act, has the power to
9administer oaths and take testimony under oath relative to the
10matter of inquiry or investigation. At any hearing ordered by
11the Department of Public Health, the Director of Public
12Health, or an agent having authority by law to issue such
13process may subpoena witnesses and require the production of
14records, papers, and documents pertinent to the inquiry. If
15any person disobeys the process or refuses to answer any
16pertinent question put to that person by the Director of
17Public Health or the Director of Public Health's authorized
18agent or to produce any records and papers so requested, the
19Director of Public Health or Director of Public Health's
20authorized agent may apply to the Circuit Court for the
21district wherein such person resides or where the business has
22been conducted, setting forth the disobedience to the process
23or refusal to answer, and said court shall order such person to
24appear before that court and to answer the questions or
25produce the records requested.

 

 

HB5517- 28 -LRB103 38605 RPS 68741 b

1    (b) If the Director of Public Health or the Director of
2Public Health's agent has received information and has a
3reasonable belief that any person, health care facility, or
4other institution has violated or is violating any provision
5of this Act, or any rule or order of the Department of Public
6Health, the Director of Public Health or the Director of
7Public Health's agent may issue a notice pursuant to this
8Section. The Department of Public Health shall notify the
9person, health care facility, or institution against whom such
10order is issued by first-class mail or personal service. The
11notice shall include: (1) a reference to the Section of the
12statutes, rule, or Section of the rules believed to have been
13violated; (2) a short and plain language statement of the
14matters asserted or charged; (3) a description of the activity
15alleged to have violated a statute or rule pursuant to
16paragraph (1) of this subsection; (4) a statement concerning
17the right to a hearing of such person, health care facility, or
18institution; and (5) a statement that the person, health care
19facility, or institution may, not later than 10 business days
20after receipt of the notice, make a written request for a
21hearing on the matters asserted, to be sent to the executive
22director of the health care facility or institution or the
23agent of the executive director.
24    (c) The person, health care facility, or institution to
25whom notice is provided under subsection (b) of this Section
26may, not later than 10 business days after receipt of the

 

 

HB5517- 29 -LRB103 38605 RPS 68741 b

1notice, make written application to the unit to request a
2hearing to demonstrate that such violation has not occurred,
3or present other defenses applicable. A failure to make a
4timely request for a hearing shall result in the Department
5issuing a cease and desist order. Each hearing held under this
6subsection shall be conducted and contested pursuant to
7Illinois Administrative Procedure Act.
8    (d) If the Department finds, by a preponderance of the
9evidence, following a hearing held under subsection (c) of
10this Section that a person, health care facility, or
11institution has violated or is violating any provision of this
12Act, or any rule or order of the Department, the Department
13shall issue a cease and desist order to such person, health
14care facility, or institution that shall be considered a final
15decision subject to appeal to the Circuit Court in accordance
16with the Administrative Review Law of the Code of Civil
17Procedure.
18    (e) Any cease and desist order issued under this Section
19may be enforced by the Attorney General.
 
20    Section 55. Report of the utilization management and
21provider payment practices of Medicare Advantage plans.
22    (a) Not later than January 1, 2026, the Department of
23Insurance, in consultation with the Department of Public
24Health, shall report to the Governor and to the General
25Assembly an analysis of the utilization management and

 

 

HB5517- 30 -LRB103 38605 RPS 68741 b

1provider payment practices of Medicare Advantage plans,
2including, but not limited to, (1) the impact of such
3practices on the delivery of hospital outpatient and inpatient
4services, including patient placement, discharges, transfers,
5and other clinical plans, (2) the costs to hospitals and plan
6members associated with such practices, (3) the effect of such
7practices on commercial, non-Medicare payment rates and access
8to services, including behavioral health services, and (4) a
9comparison of claims denials, modifications, and reversals on
10appeal among Medicare Advantage plans and with traditional
11Medicare, Medicaid, and commercial non-Medicare product lines.
12To the extent information and data are not available to
13support specified areas of such analysis, such unavailability
14shall be noted in the report.
15    (b) Based on the findings of the analysis such report
16shall provide recommendations on (1) improving quality of and
17access to care, (2) improving the timely delivery of care, (3)
18reducing provider administrative costs associated with
19utilization management, (4) addressing payment practices that
20inappropriately reduce provider payments, (5) improving any
21practices identified in the study contributing to unwarranted
22changes to clinical care plans, (6) considering quarterly
23monitoring of prior authorization requests, service denials
24and payment denials by Medicare Advantage plans and comparing
25such data with commercial plans and Medicaid, (7) addressing
26the broad effect of Medicare Advantage plan practices on the

 

 

HB5517- 31 -LRB103 38605 RPS 68741 b

1health care delivery system, including costs borne by
2non-Medicare Advantage consumers and plan sponsors, (8)
3reducing costs for consumers, and (9) the extent to which
4states have the authority to regulate Medicare Advantage
5plans. To the extent the analysis does not support
6recommendations in any of the specified areas, that outcome
7should be noted in the report.
8    (c) The Department of Insurance may engage the services of
9third-party professionals and specialists the Director of
10Insurance deems necessary to assist the Director of Insurance
11in fulfilling the requirements of this Section. The costs and
12services shall be paid from the General Revenue Fund, subject
13to appropriation.
 
14    Section 90. The Illinois Health Facilities Planning Act is
15amended by adding Section 6.5 as follows:
 
16    (20 ILCS 3960/6.5 new)
17    Sec. 6.5. Notice of intent to file an application. Any
18health care facility that intends to file an application for a
19certificate of need with the Board shall, in advance of filing
20such an application, post notice of the health care facility's
21intent to file in a conspicuous location on its website, if
22such a website exists. After filing an application for a
23certificate of need, the health care facility shall post, in a
24conspicuous location on its website, a notice of the

 

 

HB5517- 32 -LRB103 38605 RPS 68741 b

1application having been filed and a digital copy of the
2application.
 
3    Section 99. Effective date. This Act takes effect upon
4becoming law.

 

 

HB5517- 33 -LRB103 38605 RPS 68741 b

1 INDEX
2 Statutes amended in order of appearance
3    New Act
4    20 ILCS 3960/6.5 new