In 2024, state legislatures across the U.S. considered a wide range of legislation that could potentially impact hospital finances and revenue cycle operations. Issues under consideration included the provision of community benefit by nonprofit hospitals, facility fees, medical debt, and price transparency.1,2
While some states enacted legislation in these areas, most efforts in 2024 were unsuccessful. However, given ongoing voter concerns about affordability and access to care, legislatures are expected to consider similar bills in 2025. Below, we review state activity for 2024 to provide insight into legislation likely to be considered in 2025 and point to revenue cycle areas to target for process improvement.
Nonprofit Hospitals’ Community Benefit
At least 10 states considered 13 pieces of legislation related to community benefit. These bills touched on provisions such as:
- Narrowing the definition of community benefit by excluding bad debt, Medicare shortfalls, and expenses associated with screenings provided at “health fairs.”
- Excluding consideration of monetary assets when determining patient eligibility for financial assistance.
Three bills—two requiring the exclusion of monetary assets from determining eligibility for financial assistance and one related to community health needs assessment reporting requirements—were enacted in three states.
Community benefit is also a focus area at the federal level. Senators continue to scrutinize IRS enforcement of nonprofit hospital requirements, question collection practices, and request that the agency clarify requirements for financial assistance.3,4 Given the scrutiny at both the state and federal levels, nonprofit hospitals should carefully review their IRS Form 990 so that it accurately portrays the level of benefit they provide to communities. This includes reviewing and testing processes to classify eligible patients appropriately and making sure they receive financial assistance.
Facility Fees
According to a 2024 poll, 79% of Americans support federal legislation limiting facility fees, including majorities of both Democrats (88%) and Republicans (75%).5 It is no surprise that at least 11 states considered 17 pieces of legislation related to facility fees in 2024. The various bills included provisions that would have:
- Limited or capped facility fees.
- Required transparency (separate National Provider Identifier (NPI) for off-campus hospital outpatient departments or advance written notice).
- Prohibited facility fees when services are provided via telehealth.
Only three pieces of state-level legislation were enacted—two barring facility fees for telehealth services and one requiring advance notification of facility fees.
At the federal level, Congress included a provision in an initial draft of the December 2024 continuing resolution to fund the federal government that would have required off-campus hospital outpatient departments (HOPDs) to bill for services with a unique NPI effective January 1, 2026. While the provision ultimately was excluded from the continuing resolution passed on December 21, Congress will likely revisit it in future legislation. If the requirement is passed, it will enable some commercial plans to implement site-neutral payment policies under certain market circumstances.
Beyond creating additional administrative burden, the use of separate NPIs will disadvantage hospitals unable to negotiate managed care contracts that reflect the increased costs associated with delivering care to (typically sicker) patients in HOPDs.6 In addition, Congress is expected to take up legislation expanding Medicare site-neutral payments in 2025. If such legislation is successful, it will reduce Medicare payments to hospitals for impacted services.
Medical Debt
A recent national survey shows that 66% of adults are concerned that a major health event would leave them in debt.7 In addition, 41% of Americans have some type of debt from medical or dental providers.8 In 2024, at least 27 states considered 79 pieces of legislation related to the issue of medical debt, primarily focused on provisions related to:
- Prohibiting credit reporting (similar to the rule recently finalized by the Consumer Financial Protection Bureau).9
- Limiting certain collection activities.
- Requiring additional communication and/or offers of financial assistance.
- Creating programs to purchase medical debt from hospitals.
Of these, 15 bills passed at least one chamber of a statehouse, with limits on collection activities and prohibitions on credit reporting being the most common types of bills to advance.
Many hospitals and health systems view credit reporting as an important tool for resolving outstanding self-pay balances. To prepare for legislation that may limit credit reporting and other collection activities, hospitals and health systems should evaluate strategies to improve upfront collections either pre-service or at the time of service for nonemergent visits. Key components of these strategies include implementing an effective cash collection measurement and benchmarking system and developing capabilities to provide patient-specific estimates for out-of-pocket costs.
Price Transparency
Over 90% of voters support requiring hospitals and health plans to provide patients with actual prices.10 Both sides of the aisle—in Congress and statehouses—view price transparency as a key tool for lowering costs. In 2024, at least 17 states considered 32 different pieces of transparency legislation. Approximately 40% of the bills would have created state price transparency requirements similar to the existing federal requirement. Other frequent themes in the introduced bills were provisions preventing hospitals from collecting for nonemergent services and allowing patients to sue a hospital if the facility is found to be noncompliant with federal transparency requirements.
Four of these state-level price transparency bills were enacted in 2024, with provisions that include:
- Requiring proof of compliance with federal transparency law before a hospital can sue a patient.
- Requiring hospitals to post a list of shoppable services.
- Requiring insurers to comply with price transparency requirements.
- Providing data to allow for comparisons of hospital rates for in-network versus out-of-network prices.
As price transparency legislation continues to be passed at the state and federal levels, providers should frequently review their internal policies to maintain compliance. They should also consider using price transparency data to understand their market position, and inform price strategy and managed care contract negotiations.
How Forvis Mazars Can Help
Our healthcare professionals at Forvis Mazars are committed to helping organizations understand and adapt to evolving state and federal policies in their pursuit of regulatory excellence and achieving health for those they serve. If you have questions about upcoming policy changes and how they may affect your revenue cycle, please reach out to a professional on our team.
- 1“2024 State Legislation to Lower Health System Costs,” nashp.org, October 22, 2024.
- 2“2024 State Action on Medical Debt,” billtrack50.com, 2024.
- 3“Grassley, Colleagues to TIGTA and IRS – Nonprofit Hospital Tax Exemption,” grassley.senate.gov, August 7, 2023.
- 4“Warren, Grassley Pressure IRS To Crack Down on Nonprofit Hospitals Taking Advantage of Tax Code,” warren.senate.gov, November 19, 2024.
- 5“New West Health-Gallup Poll Reveals Most Americans Worried About Often Hidden Healthcare Fees,” westhealth.org, December 6, 2024.
- 6“Proposals to Reduce Medicare Payments Would Jeopardize Access to Essential Care and Services for Patients,” aha.org, June 2023.
- 7“Worries About Medical Bills Weigh on Voters’ Minds as Election Nears,” cbsnews.com, October 24, 2024.
- 8“Americans’ Challenges With Health Care Costs,” kff.org, March 1, 2024.
- 9“CFPB Finalizes Rule to Remove Medical Bills from Credit Reports” consumerfinance.gov, January 7, 2025.
- 10“9 Out of 10 Voters Support Real Hospital, Insurer Price Transparency: Poll,” thehill.com, September 9, 2024.