RELATING TO HOSPITAL PRICE TRANSPARENCY.

SB2277

THE SENATE

S.B. NO.

2277

THIRTY-THIRD LEGISLATURE, 2026

STATE OF HAWAII

A BILL FOR AN ACT

Relating
to Hospital Price Transparency
.

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

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SECTION 1.
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The
legislature finds that Hawaii's residents struggle with increased health care
costs each year.
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Many residents also
have limited knowledge of health care pricing, particularly regarding hospital
care.
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The legislature believes that
patients in the State should be empowered to compare hospital costs to find the
best value for care and services.
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Increased
price transparency would help decrease prices by better informing consumers, and
thus increasing competition in the market.

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The legislature also finds that federal requirements
currently regulate hospital price transparency.
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The federal Public Health Service Act requires
each hospital operating in the United States to make all standard charges
publicly available, including gross charges, discounted cash prices, and
charges negotiated with third-party payors.
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In 2021, the Centers for Medicare and Medicaid
Services promulgated regulations requiring hospitals to make these standard
charges publicly available in two ways:

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(1)
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A
single comprehensive machine-readable file including all standard charges
established by the hospital for all the items and services it provides; and

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(2)
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A
consumer‑friendly display of certain standard charges identified by the
Centers for Medicare and Medicaid Services.

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The legislature further finds that, according
to a 2024 analysis by the nonprofit PatientRightsAdvocate.org, no major
hospital system in the State is fully compliant with federal price transparency
requirements.
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The legislature believes
that codifying federal requirements in state law will enable the State to better
monitor and enforce compliance with the requirements thereby protecting patient
consumer rights.

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Accordingly, the purpose of this Act is to:

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(1)
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Require
each hospital in the State to comply with federal price transparency
requirements;

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(2)
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Require
the department of health to monitor and enforce compliance with federal price
transparency requirements;

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(3)
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Establish
a process for patients to challenge a debt collection lawsuit filed by a
hospital if the hospital was not in compliance with price disclosure and
transparency requirements;

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(4)
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Require
the department of health to publish a list of any enforcement actions taken
against non-compliant hospitals; and

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(5)
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Require
hospitals to provide easily accessible itemized bills to patients prior to any
debt collection or legal actions being taken against the patient.

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SECTION 2.
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Chapter 321, Hawaii Revised Statutes, is amended by adding a new part to
be appropriately designated and to read as follows:

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Part
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Hospital Price Transparency

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321-A
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Short title.
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This part shall be known and may be cited as
the "Hospital Price Transparency Act".

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321-B
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Definitions.
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For the purposes of this part unless the
context otherwise requires:

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"Chargemaster" means the list of
all hospital items or services maintained by a hospital for which the hospital
has established charges.

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"Collection action" means any of
the following actions taken with respect to a debt for an item or service that
was purchased by or provided to a patient by a hospital on a date during which
the hospital was in violation of this part:

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(1)
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Attempting
to collect a debt from a patient or patient guarantor by referring the debt,
directly or indirectly, to a debt collector, collection agency, or other third
party retained by or on behalf of the hospital;

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(2)
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Suing
the patient or patient guarantor or enforcing an arbitration or mediation
clause in a hospital document, including any contract, agreement, statement, or
bill; or

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(3)
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Directly
or indirectly causing a report to be made to a consumer reporting agency.

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"Collection agency" means a
person that:

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(1)
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Engages
in a business for the principal purpose of collecting debts; or

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(2)
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Performs
any of the following:

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(A)
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Regularly
collects or attempts to collect, directly or indirectly, debts owed or due, or
asserted to be owed or due, to another;

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(B)
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Accepts
the assignment of debts for collection purposes; or

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(C)
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Directly
or indirectly solicits for the collection of debts owed or due, or asserted to
be owed or due, to another.

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"Consumer reporting agency" means
a person that, for a monetary fee or dues on a cooperative nonprofit basis,
regularly engages in the practice of assembling or evaluating consumer credit
information or other consumer information for the purpose of furnishing
consumer reports to third parties.
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"Consumer reporting agency" does not include business entities
that only provide check verification or check guarantee services.

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"Debt" means the obligation or
alleged obligation of a consumer to pay money arising out of a transaction, regardless
of whether the obligation has been reduced to a judgment.
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"Debt" does not include a debt for
business, investment, commercial, or agricultural purposes or a debt incurred
by a business.

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"Debt collector" means a person
employed or engaged by a collection agency to perform the collection of debts
owed or due or debts asserted to be owed or due to another.

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"De-identified maximum negotiated
charge" means the highest charge that a hospital has negotiated with all
third-party payors for a hospital item or service.

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"De-identified minimum negotiated
charge" means the lowest charge that a hospital has negotiated with all
third-party payors for a hospital item or service.

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"Department" means the department
of health.

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"Discounted cash price" means the
charge that applies to a person who pays cash or a cash equivalent for a
hospital item or service.

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"Gross charge" means the charge
for a hospital item or service as reflected on the hospital's chargemaster,
excluding any discount.

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"Hospital" means a public
hospital, for-profit or nonprofit private hospital, or general or special
hospital that is licensed as a hospital by the department pursuant to section 321-14.5.

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"Item or service" means an item
or service that a hospital could provide to a patient in connection with an
inpatient admission or an outpatient visit for which the hospital has
established a standard charge, including:

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(1)
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A
supply or procedure;

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(2)
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Room
and board;

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(3)
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A
facility fee; or

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(4)
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A
professional fee.

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"Machine-readable format" means a
digital representation of information in a file that can be easily imported or
read into a computer system for further processing without any additional
preparation.

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"Patient guarantor" means a
person or entity legally responsible for paying a patient's medical bills,
including the patient, a parent, legal guardian, or spouse.

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"Payor-specific negotiated
charge" means the charge that a hospital has negotiated with a third-party
payor for a hospital item or service.

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"Professional fee" means a fee
charged by a health care practitioner for medical services.

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"Shoppable service" means a
service that may be scheduled in advance by a person.

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"Standard charge" means the
regular rate established by a hospital for a hospital item or service provided
to a specific group of paying patients.
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"Standard charge" includes the:

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(1)
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Gross
charge;

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(2)
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Payor-specific
negotiated charge;

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(3)
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De-identified
maximum negotiated charge;

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(4)
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De-identified
minimum negotiated charge; and

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(5)
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Discounted
cash price.

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"Third party payor" means an
entity other than the patient that reimburses for and manages health care
expenses incurred by a contracted beneficiary, including an insurance company,
a governmental payer, or a self-insured employer plan.

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321-C
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Public availability of price information;
required.
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(a)
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Each hospital in the State shall comply with
federal hospital price transparency requirements as provided in title 45 Code
of Federal Regulations part 180, and authorized by the Public Health Service
Act title 42 United States Code Section 300gg-18 et seq.
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Compliance shall include publishing the
following information on the hospital's publicly accessible website:

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(1)
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A
digital file in a machine-readable format that contains standard charges for
all hospital items or services displayed in dollar amounts; and

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(2)
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A
consumer-friendly list that a reasonable person could easily understand,
containing information for no fewer than three hundred shoppable services
offered and provided by that specific hospital location, with charges clearly
displayed in dollar amounts.

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(b)
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In
lieu of maintaining and making publicly available the list of shoppable services
required by subsection (a), a hospital may alternatively maintain an
internet-based price estimator tool that is deemed by the Centers for Medicare
and Medicaid Services to comply with federal hospital price transparency
requirements.

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(c)
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Except as otherwise provided in this part, the format and presentation
of the required information shall follow federal hospital price transparency requirements
and any associated guidance from the Centers for Medicare and Medicaid
Services.

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321-D
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Enforcement.
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(a)
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The
department shall establish and make available on its website an electronic form
for individuals to use to submit complaints of any alleged violations of the
hospital price transparency requirements under this part.

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(b)
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A hospital shall be in violation of this part if the hospital:

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(1)
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Violates
any provision of this part;

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(2)
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Fails
to take immediate action to remedy a violation of this part or rules adopted pursuant
to this part;

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(3)
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Fails
to submit a plan of correction in accordance with this section;

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(4)
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Fails
to comply with a plan of correction;

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(5)
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Charges
a patient more for any item or service than the dollar amount published in the
lists required by section 321-C; or

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(6)
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Violates
an order previously issued by the department in a disciplinary matter related
to this part.

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(c)
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The
department shall regularly monitor the compliance of hospitals with the
requirements of this part by:

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(1)
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Evaluating
any received complaints regarding noncompliance with this part;

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(2)
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Reviewing
any third-party analysis prepared regarding noncompliance with this part;

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(3)
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Auditing
hospital websites for compliance with this part; and

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(4)
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Taking
any additional measures that the department deems reasonable and necessary in
accordance with this part.

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(d)
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If
the department determines that a hospital is not in compliance with any
provision of this part, the department shall issue a written notice to the
noncompliant hospital that:

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(1)
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Clearly
explains the manner in which the hospital is noncompliant with this part; and

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(2)
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Requires
the hospital to either:

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(A)
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Take
immediate corrective action to remedy the violation; or

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(B)
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Submit
a plan of correction to the department within thirty calendar days if the
hospital is unable to reasonably take corrective action to remedy the
violation.

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(e)
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Any
hospital required to take immediate corrective action pursuant to subsection
(d)(2)(A) shall provide the department with written confirmation that the
necessary corrective action has been taken within thirty calendar days of the
department's written notice.

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(f)
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For
any hospital required to submit a plan of correction pursuant to subsection (d)(2)(B),
the department shall require that the violation be remedied within a specified
period of time, as determined by the department.
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A hospital shall be deemed to have failed to
comply with a plan of correction if the hospital fails to adequately address a
violation within the time period specified by the department.

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(g)
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The department shall publish and maintain a publicly available list on
its website of any hospitals determined to be noncompliant with the hospital
price transparency requirements under this part.

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321-E
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Civil penalties.
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(a)
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Any
hospital that violates any of the requirements under this part shall be subject
to the following civil penalties for each separate offense:

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(1)
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Not
less than $600 for a hospital having thirty or fewer beds;

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(2)
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Not
less than $20 per bed for a hospital having at least thirty-one beds, but fewer
than five hundred fifty beds; and

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(3)
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Not
less than $11,000 for a hospital having more than five hundred fifty beds.

Each day of
the violation shall constitute a separate offense.

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(b)
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In determining the amount of a civil penalty imposed pursuant to
subsection (a), the department shall consider:

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(1)
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Any
previous violations by the hospital;

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(2)
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The
severity of the violation;

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(3)
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Any
demonstrated good-faith effort by the hospital to comply with this part and any
order issued by the department; and

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(4)
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Any
other factors as determined by the department in accordance with the purposes
of this part.

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�321-F
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Collection of debt; noncompliance.
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(a)
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No hospital in violation of
this part on the date that items or services are purchased by or provided to a
patient by the hospital shall initiate or pursue a collection action against
the patient, patient guarantor, or applicable third-party payor for a debt owed
for the items or services; provided that the violation is related to the
patient's billed items or services.

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(b)
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A
collection action initiated by a hospital, or any agent, assignee, or
successor-in-interest to the hospital's rights as a creditor in violation of
subsection (a) shall constitute a complete affirmative defense to the
collection action, and the patient or patient guarantor may file a declaratory
judgment action based on the same.

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(c)
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A
patient subject to a lawsuit for the collection of medical debt in violation of
this section may file a counterclaim to determine whether:

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(1)
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The
hospital was noncompliant with any provision of this part or related rules adopted
by the department on the date that the items or services were provided or
purchased; and

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(2)
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The
noncompliance was related to the items or services.

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(d)
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A hospital found to be noncompliant with this part by a judge or jury in
a counterclaim action pursuant to subsection (c), at a minimum shall:

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(1)
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Refund
the payor any amount of the debt paid by the payor;

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(2)
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Cover
any costs of the action incurred by the patient or patient guarantor, including
reasonable attorney fees as determined appropriate by the court;

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(3)
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Dismiss
or cause to be dismissed with prejudice any court action; and

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(4)
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Remove
or cause to be removed from the patient or patient guarantor's credit report
any report made to a consumer reporting agency relating to the debt.

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(e)
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Nothing in this section shall be construed to:

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(1)
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Prohibit
a hospital in compliance with this part from billing a patient, patient
guarantor, or third-party payor, including a health insurer, for an item or
service provided to the patient; or

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(2)
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Require
a hospital to refund a payment made to the hospital for an item or service provided
to the patient if no collection is taken in violation of this section.

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321-G
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Patient rights.
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(a)
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Prior
to initiating a collection action against a patient, a hospital or a debt
collector acting on behalf of a hospital shall provide the patient with:

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(1)
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An
easy-to-understand itemized statement of the medical debt owed by the patient
to the hospital, including the applicable billing codes for each item or
service, using commonly recognized billing code sets;

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(2)
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A
copy of the detailed receipts of any payments made to the hospital or debt
collector by the patient or the patient's guarantor within thirty calendar days
of each payment;

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(3)
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Information
about the availability of language‑assistance services for persons with
limited English proficiency; and

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(4)
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The
contact information for a designated office or administrator at the hospital
who can:

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(A)
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Discuss
the specific details of an itemized statement; and

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(B)
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Make
appropriate changes to the statement, if warranted.

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(b)
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Any
willful or knowing violation of this section shall constitute an unfair or
deceptive act or practice in violation of chapter 480.

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321-H
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Rulemaking.
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The department may adopt rules pursuant to
chapter 91 as necessary to implement and administer this part."

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SECTION 3.
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This Act does not affect rights and duties that matured, penalties that
were incurred, and proceedings that were begun before its effective date.

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SECTION 4.
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In codifying the new sections added by section 2 of this Act, the
revisor of statutes shall substitute appropriate section numbers for the
letters used in designating the new sections in this Act.

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SECTION 5.
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This Act shall take effect upon its approval.

INTRODUCED BY:

_____________________________

Report Title:

DOH;
Health Care; Hospitals; Price Transparency; Consumer Protection; Enforcement;
Federal Requirements; Civil Penalties

Description:

Requires each
hospital in the State to comply with federal hospital price transparency
requirements.
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Requires the Department of
Health to monitor and enforce compliance.
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Establishes a process for patients to challenge debt collection actions
filed by a noncompliant hospitals.
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Requires the Department of Health to publish a list of any enforcement
actions taken against noncompliant hospitals.
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Requires hospitals to provide patients with an easy-to-understand
itemized bill statement before initiating a debt collection action against a
patient.

The summary description
of legislation appearing on this page is for informational purposes only and is
not legislation or evidence of legislative intent.