Fair Billing Act
- Bill Number
- S. 2497
- Origin Chamber
- Senate
- Congress
- 119th Congress, Session 1
- Policy Area
- Health
- Status
- Introduced
- Latest Action
- 2025-07-29: Read twice and referred to the Committee on Finance.
- Last Updated
- 2026-02-05T17:34:30Z
AI-Generated Summary
Purpose
The Fair Billing Act aims to promote transparency and compliance in Medicare billing for off-campus outpatient departments (OPDs) of hospitals or other providers. These are facilities that deliver outpatient medical services but are not located on the hospital's main campus. By requiring separate identification numbers and regular confirmations of compliance, the legislation seeks to ensure that such departments meet federal standards for being classified as part of a hospital, which affects how services are reimbursed under Medicare.
Key Provisions
- Separate Identification Requirement: Starting January 1, 2026, Medicare will not pay for services provided by an off-campus OPD unless it uses a unique health identifier (a standardized code for healthcare providers) that is distinct from the main hospital's identifier. This applies to payments under the Outpatient Prospective Payment System (OPPS) or similar systems.
- Attestation Process: Providers must submit:
- An initial attestation (a formal statement) confirming the off-campus OPD complies with federal regulations (specifically 42 CFR 413.65, which outlines criteria for a facility to be considered "provider-based," meaning it's legally part of the hospital).
- This initial attestation must be filed within two years before the services are provided.
- Follow-up attestations at intervals set by the Secretary of Health and Human Services (HHS).
- Review and Enforcement: Within one year of the bill's enactment, HHS must create a process (through public input and rulemaking) for submitting and reviewing these attestations. Reviews may include on-site visits, remote audits, or other methods to verify compliance.
- Definition of Off-Campus OPD: An off-campus OPD is a hospital department not located on the main campus or within the specified distance from a remote hospital location, as defined in federal regulations.
- Oversight Report: By January 1, 2030, the HHS Office of Inspector General (OIG) must analyze the attestation review process and provide recommendations to Congress.
Significant Changes to Existing Law
- This amends Section 1833(t) of the Social Security Act (which governs Medicare's OPPS for outpatient services) by adding a new paragraph (23). Previously, off-campus OPDs could often use the same billing identifier as the main hospital, potentially allowing higher reimbursement rates for services that might otherwise be treated as physician office visits (which are reimbursed at lower rates).
- Introduces mandatory separate identifiers and periodic attestations, which were not previously required for Medicare payments. It builds on existing provider-based rules but enforces them more stringently through unique IDs and HHS oversight.
Potential Impacts
- On Government Agencies: HHS will face increased administrative responsibilities, including rulemaking, attestation processing, and compliance checks, potentially requiring additional resources. Medicare could see cost savings if improper high-rate billing for off-campus services is reduced, promoting "site-neutral" payments (treating similar services the same regardless of location).
- On Citizens (Medicare Beneficiaries): Patients may benefit from more accurate billing, potentially lowering overall Medicare costs and reducing out-of-pocket expenses if services are reimbursed at appropriate rates. However, non-compliant facilities might face payment denials, possibly disrupting access to care in some areas.
- On International Relations: No direct impacts, as this is a domestic healthcare policy focused on U.S. Medicare.
Main Stakeholders Affected
- Hospitals and Providers: Those with off-campus OPDs will need to update billing systems, submit attestations, and ensure regulatory compliance, increasing administrative burdens and compliance costs.
- Medicare Beneficiaries: Older adults and disabled individuals relying on Medicare for outpatient care may experience changes in service availability or costs.
- HHS and Medicare Administration: Responsible for implementing and enforcing the new rules, including audits and rulemaking.
- Congress and Oversight Bodies: The HHS OIG will conduct evaluations, informing future policy adjustments.
- Healthcare Industry Groups: Associations representing hospitals may advocate for or against implementation based on financial implications.
Notable Legal, Constitutional, or Political Implications
- Legal: Strengthens enforcement of existing provider-based regulations through administrative processes like rulemaking and audits, which must follow the Administrative Procedure Act (requiring public notice and comment). Non-compliance could lead to payment denials, potentially sparking legal challenges from providers over due process or burden of proof in reviews.
- Constitutional: No major issues; it aligns with Congress's authority under the Spending Clause to regulate federal healthcare programs like Medicare.
- Political: Could advance bipartisan goals of reducing Medicare waste and ensuring fair billing, as introduced by Senators from different parties. However, it may face opposition from hospital lobbies concerned about revenue losses, while supported by those favoring cost controls in healthcare spending. The delayed implementation (2026) and OIG review provide opportunities for adjustments based on real-world effects.
This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.
Sponsor
Sen. Hassan, Margaret Wood [D-NH]
Cosponsors (1)
Recent Actions
- 2025-07-29: Read twice and referred to the Committee on Finance.
- 2025-07-29: Introduced in Senate
Bill Versions
- Fair Billing Act — issued 2025-07-29 — PDF (4 pages)