Federal and State Governments Target Hospital and Facility Fees

Hospital outpatient departments may suffer payment cuts as soon as next year if site-neutral payment proposals are passed by Congress


Policymakers are targeting facility fees at hospital-owned outpatient departments in an attempt to make them more obvious to patients, or to eliminate them altogether. Hospitals claim these fees are necessary to cover the regulatory, administrative, and overhead costs of operating their facilities; policymakers say they contribute to increased spending and can lead to surprise medical bills for patients.


In July 2023, the Biden administration released guidance to remind hospitals and health plans of their obligations to warn patients about facility fees under the No Surprises Act. Congress and state governments propose to address facility fees by mandating site-neutral payments — meaning that hospital-owned outpatient departments would not be paid more than independent physicians’ offices for similar, specific services.