John O'Brien Apr. 18, 2014, 2:36pm

HARTFORD, Conn. (Legal Newsline) - Connecticut Attorney General George Jepsen released a report on Wednesday concerning hospital facility fees and hospital acquisitions of independent physician practices.

A facility fee is a charge levied by a hospital or a hospital-acquired physician practice that purportedly covers the overhead costs of the hospital. The fees come in addition to the professional charges billed by a provider. Jepsen said the fees can be expensive, surprising and confusing for patients.

"From the beginning, my office has sought to bring all stakeholders to the table - including hospitals and their patients - in order to gain a greater understanding of the evolving health care landscape, the application of facility fees and the overall impact on patients," Jepsen said. "That process was invaluable, and I've detailed my office's findings in this report. Overall, legislation that guarantees across-the-board transparency is greatly needed given the rapidly changing nature of the health care system in Connecticut."

In 2013, Jepsen said he would seek legislation to improve consumer protections related to facility fees. He requested information from patients and the state's hospitals, including information on disclosures and how the fees were applied. His report found that independent physician groups charged much higher facility fees when they were acquired by hospitals.

"Although Connecticut is a relatively densely populated state with adequate hospital choice, the trend toward consolidation and acquisition may pose risks to competition," Jepsen said. "Acquisitions and mergers often make business sense, and may lead to some efficiencies and more integrated care, but they also may result in higher prices, fewer consumer options and lack of competition. Legislation requiring notice to my office of these acquisitions will allow us to better monitor the market and enforce antitrust laws designed to protect Connecticut consumers."

Jepsen urged lawmakers to approve pending legislation he proposed to require improved notification and transparency.

"I strongly believe that this year's legislation is important to ensure that all patients receive adequate notice, prior to treatment, so they can make informed choices about their health care and about whether or not to visit a practice that charges facility fees," Jepsen said. "I urge both chambers of the General Assembly to approve both this bill and the acquisition bill this year."

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