Another Step Toward Fair Hospital Pricing…

Today, Health Access California, the statewide health care consumer advocacy coalition, is pleased to announce our support of a statewide ballot initiative to reduce hospital charges in California.

Anybody who has ever seen a hospital bill has been shocked and puzzled for good reason, because hospitals admit that their charges have no relation to the cost of care, or frankly anything else. Because hospitals are vital institutions in our community, we have allowed charges from them that no other industry could get away with. This initiative takes an important step toward needed reform.

Health Access has worked for years on health care and hospital pricing issues, including the first-in-the-nation 2006 Hospital Fair Pricing Act, which limited how much hospitals could collect from patients under 350% of the poverty level who were uninsured or underinsured. That law protects these patients from paying from paying the hospital bills that are more than three to four times what insured patients pay for the same treatment. Health Access has also supported and advanced other measures to publicly disclose hospital chargemasters and other prices, and other reforms. Even with these protections, too many patients continue to get harmed by hospital charges that are artificially inflated and that have no relation to the cost or quality of care provided.

The ballot measure is sponsored by members of SEIU-UHW, the state’s largest union of hospital and other healthcare workers, and is estimated to reduce hospital charges by more than $3.4 billion a year. Signature gatherers are working across the state to qualify the measure for the November 2014 ballot.

The Fair Healthcare Pricing Act of 2014 prohibits hospitals from charging more than 25 percent above the actual cost of providing patient care. On average, California hospitals charge 320 percent more than the actual cost of providing care in their facilities. According to the Office of Statewide Health Planning and Development, California hospitals subject to this ballot initiative charged $233.8 billion in 2012 – even though their operating expenses were only $54.5 billion.

We look forward to working with SEIU and a growing coalition of supporters on this and other measures.

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