SF 1503

1st Engrossment - 94th Legislature (2025 - 2026)

Posted on 03/31/2025 02:15 p.m.

A bill for an act
relating to health; prohibiting facility fees for nonemergency services provided at
provider-based clinics; prohibiting facility fees for certain health care services;
requiring a report; proposing coding for new law in Minnesota Statutes, chapter
62J; repealing Minnesota Statutes 2024, section 62J.824.

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

Section 1.

new text begin [62J.8241] FACILITY FEES PROHIBITED.
new text end

new text begin Subdivision 1. new text end

new text begin Definitions. new text end

new text begin (a) For purposes of this section, the definitions have the
meanings given.
new text end

new text begin (b) "Facility fee" means any separate charge or billing by a provider-based clinic in
addition to a professional fee for physicians' services that is intended to cover building,
electronic medical records systems, billing, and other administrative and operational
expenses.
new text end

new text begin (c) "Health care provider" has the meaning given in section 145B.02.
new text end

new text begin (d) "Provider-based clinic" means the site of an off-campus clinic or provider office,
located at least 250 yards from the main hospital buildings or as determined by the Centers
for Medicare and Medicaid Services, that is owned by a hospital licensed under chapter 144
or a health system that operates one or more hospitals licensed under chapter 144, and is
primarily engaged in providing diagnostic and therapeutic care, including medical history,
physical examinations, assessment of health status, and treatment monitoring. This definition
does not include clinics that are exclusively providing laboratory, x-ray, testing, therapy,
pharmacy, or educational services and does not include facilities designated as rural health
clinics.
new text end

new text begin Subd. 2. new text end

new text begin Provider-based clinic prohibition. new text end

new text begin Health care providers are prohibited from
charging, billing, or collecting a facility fee for nonemergency services provided at a
provider-based clinic, including services provided by telehealth as defined in section 62A.673,
subdivision 2, paragraph (h).
new text end

new text begin Subd. 3. new text end

new text begin Service-specific prohibition. new text end

new text begin Regardless of where the services are provided,
health care providers are prohibited from charging, billing, or collecting a facility fee for:
new text end

new text begin (1) outpatient evaluation and management services; and
new text end

new text begin (2) any other services identified by the commissioner of health pursuant to subdivision
5, paragraph (a).
new text end

new text begin Subd. 4. new text end

new text begin Reporting. new text end

new text begin (a) By January 15, 2027, and each year thereafter, hospitals licensed
under chapter 144 and health systems operating one or more hospitals licensed under chapter
144 must submit a report to the commissioner of health identifying facility fees charged,
billed, and collected during the preceding calendar year. The commissioner must publish
the information reported on a publicly accessible website. The report shall be in the format
prescribed by the commissioner of health.
new text end

new text begin (b) The report under this subdivision must include the following information for each
facility owned or operated by the hospital or health system providing services for which a
facility fee is charged, billed, or collected:
new text end

new text begin (1) the name and full address of each facility;
new text end

new text begin (2) the number of patient visits at each facility; and
new text end

new text begin (3) the number, total amount, and range of allowable facility fees paid at each facility
by Medicare, medical assistance, MinnesotaCare, and private insurance.
new text end

new text begin (c) The report under this subdivision must include the following information for the
entire hospital or health system:
new text end

new text begin (1) the total amount charged and billed for facility fees;
new text end

new text begin (2) the total amount collected from facility fees;
new text end

new text begin (3) the top ten procedures or services provided by the hospital or health system that
generated the greatest amount of facility fee gross revenue, the volume each of these ten
procedures or services and gross and net revenue totals, for each such procedure or service,
and the total net amount of revenue received by the hospital or health system derived from
facility fees;
new text end

new text begin (4) the top ten procedures or services, based on patient volume, provided by the hospital
or health system for which facility fees are charged, billed, or collected, based on patient
volume, including the gross and net revenue totals received for each such procedure or
service; and
new text end

new text begin (5) any other information related to facility fees that the commissioner of health may
require.
new text end

new text begin Subd. 5. new text end

new text begin Regulatory authority. new text end

new text begin (a) The commissioner of health may adopt rules to
include additional outpatient, diagnostic, imaging, or other services in the prohibition on
facility fees set forth in subdivision 3. The commissioner may only include in the prohibition
services that the commissioner determines are reliably provided safely and effectively in
settings other than hospitals.
new text end

new text begin (b) The commissioner of health may adopt rules to carry out the provisions of this section.
new text end

new text begin Subd. 6. new text end

new text begin Enforcement. new text end

new text begin (a) A violation of this section is an unlawful business practice
for purposes of section 8.31. The attorney general may enforce this section pursuant to
section 8.31.
new text end

new text begin (b) The commissioner of health and health-related licensing boards may impose penalties
for noncompliance consistent with their authority to regulate health care providers.
new text end

new text begin (c) In addition to penalties provided in paragraphs (a) and (b), the commissioner of health
may impose an administrative penalty on a health care provider that violates this section.
The penalty must not exceed $1,000 per occurrence.
new text end

new text begin (d) The commissioner of health or its designee may audit any health care provider for
compliance with the requirements of this section. A health care provider must make available,
upon written request of the commissioner or its designee, copies of any books, documents,
records, or data that are necessary for the purposes of completing the audit for four years
after the furnishing of any services for which a facility fee was charged, billed, or collected.
new text end

Sec. 2. new text begin REPEALER.
new text end

new text begin Minnesota Statutes, section 62J.824, new text end new text begin is repealed.
new text end

APPENDIX

Repealed Minnesota Statutes: S1503-1

62J.824 FACILITY FEE DISCLOSURE.

(a) Prior to the delivery of nonemergency services, a provider-based clinic that charges a facility fee shall provide notice to any patient, including patients served by telehealth as defined in section 62A.673, subdivision 2, paragraph (h), stating that the clinic is part of a hospital and the patient may receive a separate charge or billing for the facility component, which may result in a higher out-of-pocket expense.

(b) Each health care facility must post prominently in locations easily accessible to and visible by patients, including on its website, a statement that the provider-based clinic is part of a hospital and the patient may receive a separate charge or billing for the facility, which may result in a higher out-of-pocket expense.

(c) This section does not apply to laboratory services, imaging services, or other ancillary health services that are provided by staff who are not employed by the health care facility or clinic.

(d) For purposes of this section:

(1) "facility fee" means any separate charge or billing by a provider-based clinic in addition to a professional fee for physicians' services that is intended to cover building, electronic medical records systems, billing, and other administrative and operational expenses; and

(2) "provider-based clinic" means the site of an off-campus clinic or provider office, located at least 250 yards from the main hospital buildings or as determined by the Centers for Medicare and Medicaid Services, that is owned by a hospital licensed under chapter 144 or a health system that operates one or more hospitals licensed under chapter 144, and is primarily engaged in providing diagnostic and therapeutic care, including medical history, physical examinations, assessment of health status, and treatment monitoring. This definition does not include clinics that are exclusively providing laboratory, x-ray, testing, therapy, pharmacy, or educational services and does not include facilities designated as rural health clinics.