HR3023-119

What This Bill Does

The Preventing Hospital Overbilling of Medicare Act targets hospital billing for off-campus outpatient departments. It defines an off-campus outpatient department by reference to 42 CFR 413.65 and applies the Medicare changes to items and services furnished on or after January 1, 2026. The bill lets the HHS Secretary use site-neutral payment methods to reduce Medicare expenditures and prevent hospitals from billing services furnished at off-campus outpatient departments as though they were furnished at the main hospital. It requires each off-campus outpatient department to receive a separate unique health identifier by January 1, 2026, directs HHS to revise HIPAA identifier regulations, and requires hospitals to bill Medicare and Medicare Advantage for off-campus department services using that identifier on HIPAA X12 837P or CMS 1500 forms. For commercial coverage, new Public Health Service Act section 2799B-10 bars a provider from submitting claims to a group health plan or issuer, or billing the patient, unless the same separate identifier and form requirements are met. HHS must ask NAIC to create a model act or regulation allowing plans and issuers to reject noncompliant claims.

Who Benefits and How

Medicare beneficiaries using off-campus departments benefit if site-neutral billing reduces program overpayments and patient cost exposure. Commercial insurance enrollees benefit because providers cannot hold patients liable for off-campus department claims that lack the required identifier and form. Group health plans benefit from a statutory basis to reject improperly billed off-campus hospital claims. Health insurance issuers benefit from clearer claim-format rules and a requested NAIC model standard. CMS payment administrators benefit from separate identifiers that make off-campus departments easier to track.

Who Bears the Burden and How

Hospitals with off-campus outpatient departments must obtain and use separate identifiers on Medicare, Medicare Advantage, and commercial claims. Off-campus outpatient departments face reduced ability to bill as if services were furnished at the main hospital. HHS must revise HIPAA identifier regulations, implement Medicare billing rules, and request NAIC model legislation. Providers risk rejected commercial claims and cannot bill patients when they fail to use required identifiers and claim forms.

Key Provisions

• Defines off-campus outpatient departments for Medicare outpatient payment rules.
• Authorizes site-neutral payment actions to prevent main-hospital billing for off-campus services.
• Requires separate unique health identifiers for off-campus outpatient departments by January 1, 2026.
• Bars commercial claims and patient billing unless off-campus services use the separate identifier and proper form.
• Directs HHS to request NAIC model legislation or regulations for rejecting noncompliant claims.