Hospitals in Colorado will soon face a ban on pursuing debt collections against patients if they do not post their prices online – thanks to legislation signed into law by Gov. Jared Polis on Wednesday.

Beginning in August, House Bill 1285 prohibits hospitals not following federal price transparency laws from using debt collectors, filing negative credit reports against patients and obtaining state court judgements for outstanding debts. Noncompliant hospitals can still bill patients, but if they pursue collection actions, they must refund any debt paid by the patient, in addition to all legal fees.

“We are making sure that when Coloradans go to the doctor, they don’t end up with surprise bills for getting the care they need, and that hospital pricing is available to increase competition and drive down costs,” Polis said. “We are taking a major step forward to keep money in the pockets of hardworking Coloradans.”

This comes as, more than a year after it went into effect, only 6% of Colorado hospitals are in full compliance with the price transparency law that allows patients to compare costs between hospitals, according to a report by PatientRightsAdvocate.org. That is below the national average of 14.3% compliance.

The bipartisan-sponsored bill passed the legislature overwhelmingly, receiving only one “no” vote in the House and unanimous approval in the Senate.

“Hospitals are required to be open and honest about what they’re changing patients,” said House Majority Leader Daneya Esgar, D-Pueblo, who sponsored the bill. “Coloradans deserve to know what they’re getting when it comes to health care, and this legislation protects them against surprise medical bills that are often shockingly expensive.”

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Hospitals opposed the bill, arguing it would lead to frivolous lawsuits for large hospital systems and threaten the businesses of smaller hospitals that do not have the resources to comply with price transparency right now.

As a compromise, legislators amended the bill to give small, critical access hospitals with less than 25 beds more time to comply. For these hospitals, the bill will go into effect in February 2023 instead of this August. Lawmakers also changed the bill to specify that patients can only complain about price transparency for procedures relevant to their own care.

The only “no” vote against the bill came from Grand Junction Republican Rep. Janice Rich, who said she opposed the measure because she is “just tired of the government’s meddling” in business.

Also on Wednesday, Polis signed House Bill 1284, which expands protections against surprise health insurance bills by aligning state law with the federal No Surprises Act. The latter went into effect in January.

“We need to do everything we can to protect Coloradans from malicious surprise billing practices,” said Sen. Brittany Pettersen, D-Lakewood, who sponsored HB-1284. “This new law will increase protections for patients, lower the cost of health care for Coloradans, and improve patient outcomes as we work to build a healthier Colorado for all.”

The bill provides additional protections for patients, such as by requiring insurers to pay for post-stabilization services at the in-network level and to cover emergency health-care services, regardless of where provided, also at the in-network benefit level.

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