SPRINGFIELD, Ill. (Legal Newsline)-Legislation drafted by Illinois Attorney General Lisa Madigan that would limit the amount of money hospitals can charge certain uninsured patients is winding its way through the state Legislature.

If enacted, the bill would place an annual cap of 135 percent above cost on the amount that hospitals can charge eligible uninsured patients.

The proposal would also limit the total amount a hospital can collect from an uninsured patient to 25 percent of the patient's gross family income during a 12 month period.

The Hospital Uninsured Patient Discount Act, outlined in Senate Bill 2380, is backed by the Illinois Hospital Association.

"We are the health care safety net for the uninsured," said Danny Chen, spokesman for the Illinois Hospital Association. "When the uninsured need care, they go to the emergency room" because they lack health insurance, he told Legal Newsline.

Chen said the bill is "a reasonable, workable approach that resulted from extensive discussions" with the attorney general's office over a period of months.

In a statement, Madigan said on average, the state's hospitals charge uninsured patients 200 percent above their cost of providing care. The Democrat said the disparity throws families into hardship and sometimes financial ruin.

"This bill will help ease that burden and make hospital care more accessible and affordable to more than 83 percent of Illinois families who do not have health insurance," Madigan said.

The law would apply to those living within 600 percent of the Federal Poverty Level, which is $127,200 for a family of four, at non-rural hospitals and 300 percent of the Federal Poverty Level, or $63,600 for a family of four in 2008, at rural hospitals.

The House-approved legislation is carried by state Rep. Karen May, D-Highland Park.

"This is an issue of basic fairness," May said. "The uninsured are the only people who are billed the full sticker price for hospital care. Eligible Illinois residents will now be able to receive a hospital bill closer to what everyone else is paying."

From Legal Newsline: Reach reporter Chris Rizo by e-mail at chrisrizo@legalnewsline.com.