This report is an update to KXAN’s “Medical Debt Lawsuits” investigation. Our team will continue to follow the bills during Texas’ legislative session.
AUSTIN (KXAN) – State lawmakers and a representative of the Texas Hospital Association expressed concern Monday about legislation that would require health care providers to send patients an itemized bill when billing for medical services, according to testimony at a House Public Health Committee meeting.
House Bill 1973, by State Rep. Caroline Harris, R-Round Rock, said a health care provider would not be allowed to pursue debt collection against a patient without providing an itemized bill.
Currently patients can request an itemized bill, but they don’t get it automatically, Harris said.
“The lack of an itemized bill continues to hide actual prices from patients – even after they’re being told what they owe – and doesn’t allow patients a chance to check and make sure that the correct services were billed for,” Harris testified Monday at the Capitol. “I think we can all agree that transparency in health care is critical, especially when it comes to costs. Research shows that six out of 10 Americans have medical debt, and that 80% of hospital bills have errors.”
Harris, a freshman, said she block-walked and knocked on 11,000 doors, and the overwhelming majority of her constituents want this legislation.
The itemized bill would have to include the amount the provider would accept as full payment for each service or supply, a plain language description of the charge, and the billing codes and costs provided to third parties involved in reimbursement, according to the legislation.
A patient could request the itemized bill again after it is initially provided, and the itemized bill could be sent electronically or through a patient portal, according to the legislation.
Opposition and concern
Michelle Lindsley – who spoke on behalf of the Texas Hospital Association and Memorial Hermann Health System where she is vice president of managed care – registered and testified in opposition to the bill.
Lindsley said legislation would present challenges to implement, cause confusion among patients and create additional hospital expenses. Memorial Hermann has more than 1.6 million patient encounters per year, and less than 2% of its patients request itemized bills, she said. An itemized bill could be two pages for outpatient services, or it could be hundreds of pages for in-patient care, she said.
The charge rates noted in an itemized bill also may not reflect the ultimate cost a patient would need to pay because of their health insurance benefits or an up-front payment for services, which could lead to confusion, she said.
“Under the proposed requirement, we estimated the cost to be upwards of $3 to $5 million annually,” Lindsley said.
Lindsley said those costs would cover enhancing the hospital’s processes to send itemized bills, more staff to handle more patient calls, making patient portal space larger and sending potentially large and sensitive documents through the U.S. certified mail.
“Hospitals continue to be well intended and committed to transparency specific to a patient’s health care costs,” Lindsley said. “We absolutely have opportunity to communicate better with our patients and Memorial Hermann continually reviews how we best maximize the many vehicles we have to share information.”
‘How this game works’
Rep. Tom Oliverson, R-Cypress, was also troubled by the increased costs of providing voluminous itemization. Oliverson is a licensed medical doctor and anesthesiologist.
“If that becomes the law, and that increases their costs, then we all know how this game works, right?” Oliverson said. “That just ends up getting passed along down the food chain, and ultimately everyone’s premiums go up as a result.”
Rep. Ann Johnson, D-Houston, also voiced concern about the impact of the bill on hospitals. Johnson, an attorney, said medical bills aren’t necessarily comparable to bills in other industries, such as restaurants. As an example, Johnson said a person would not be able to understand every charge they incurred while under sedation in an operating room.
“I don’t want to create a burden on hospitals to do something that, as we said, currently under law you can opt in and say, ‘I want it,’” Johnson said during the hearing.
Harris said she was open to recrafting language in the bill to address issues raised by the hospital industry and lawmakers.
Medical debt lawsuits
Harris’ legislation follows a KXAN investigation into a Williamson County hospital that filed hundreds of lawsuits against patients for unpaid medical bills. KXAN spoke with defendants in those small-claims cases who said they struggled to get itemized invoices even after several attempts.
Harris spoke specifically at the hearing about hospital lawsuits originating in her district in Williamson County and one woman couldn’t get an itemized bill before getting sued.
“Instead of going to court, she decided to reach into her savings and pay that bill. She couldn’t get an itemized receipt, and she’s a single mom with three daughters,” Harris said.
In 2021, Sen. Paul Bettencourt, R-Houston, filed legislation similar to Harris’, but it didn’t pass.
The current House bill has an identical counterpart in the senate – SB 490 by Sen. Bryan Hughes, R-Mineola – and Bettencourt is a co-author.
Harris’ bill was left pending in committee Monday. Her office will present a committee substitute that could be voted on.