S.F. 431 Section 1. Section 507B.4, subsection 3, Code 2023, is 1 amended by adding the following new paragraph: 2 NEW PARAGRAPH . u. Improper denial of claims. A health 3 carrier improperly denying claims under chapter 514M.1. 4 Sec. 2. NEW SECTION . 514M.1 Short title. 5 This chapter shall be known and may be cited as “The 6 Patient’s Right to Save Act” . 7 Sec. 3. NEW SECTION . 514M.2 Definitions. 8 As used in this chapter, unless the context otherwise 9 requires: 10 1. “Collection action” means any of the following actions 11 taken with respect to a debt for health care services purchased 12 from, or provided to a covered person by, a health care 13 provider on a date on which the health care provider was not in 14 material compliance with this chapter: 15 a. Attempting to collect a debt from a covered person or 16 a covered person’s guarantor by referring the debt, directly 17 or indirectly, to a debt collector, a collection agency, or 18 other third-party retained by or on behalf of the health care 19 provider. 20 b. Suing a covered person or a covered person’s guarantor, 21 or enforcing an arbitration or mediation clause in a health 22 care provider’s contract, agreement, statement, or bill. 23 c. Directly or indirectly causing a report to be made to a 24 consumer reporting agency. 25 2. “Collection agency” means a person that regularly 26 collects or attempts to collect, directly or indirectly, 27 debts owed, due, or asserted to be owed or due; that takes 28 assignment of debts for collection purposes; or that directly 29 or indirectly solicits for collection debts owed, due, or 30 asserted to be owed or due. 31 3. “Consumer reporting agency” means a person that for 32 monetary fees, dues, or on a cooperative nonprofit basis, 33 regularly engages in assembling or evaluating consumer credit 34 information, or other consumer information, for the purpose of 35 -1- LSB 1883XS (6) 90 ko/rn 1/ 11

S.F. 431 providing consumer reports to third parties, and that uses any 1 means or facility of interstate commerce for the purpose of 2 preparing or furnishing consumer reports. “Consumer reporting 3 agency” does not include any person that only provides check 4 verification or check guarantee services. 5 4. “Cost-sharing” means any coverage limit, copayment, 6 coinsurance, deductible, or other out-of-pocket expense 7 obligation imposed on a covered person by a policy, contract, 8 or plan providing for third-party payment or prepayment of 9 health or medical expenses. 10 5. “Covered person” means the same as defined in section 11 514J.102. 12 6. “Debt” means an obligation or alleged obligation of a 13 consumer to pay money arising out of a transaction, whether or 14 not the obligation has been reduced to judgment. “Debt” does 15 not include a consumer debt incurred for business, investment, 16 commercial, or agricultural purposes, or a debt incurred by a 17 business. 18 7. “Debt collector” means a person employed or engaged by a 19 collection agency to perform debt collection. 20 8. “Deidentified minimum negotiated charge” means the lowest 21 charge for a specific health care service that a health care 22 provider has negotiated with a health carrier. 23 9. “Discounted cash price” means the price an individual 24 pays for a specific health care service if the individual pays 25 for the health care service with cash or a cash equivalent. 26 10. “Health benefit plan” means the same as defined in 27 section 514J.102. 28 11. “Health care provider” means a physician or other 29 health care practitioner licensed, accredited, registered, or 30 certified to perform specified health care services consistent 31 with state law, an institution providing health care services, 32 a health care setting, including but not limited to a hospital 33 or other licensed inpatient center, an ambulatory surgical 34 or treatment center, a skilled nursing center, a residential 35 -2- LSB 1883XS (6) 90 ko/rn 2/ 11

S.F. 431 treatment center, a diagnostic, laboratory and imaging center, 1 or a rehabilitation or other therapeutic health setting. 2 12. “Health care services” means the same as defined in 3 section 514J.102. 4 13. “Health carrier” means the same as defined in section 5 514J.102. 6 14. “Pharmacist” means the same as defined in section 7 155A.3. 8 15. “Pharmacy” means the same as defined in section 155A.3. 9 Sec. 4. NEW SECTION . 514M.3 Health care services —— cost 10 controls. 11 1. a. All health care providers shall establish and 12 disclose the discounted cash price the health care provider 13 will accept for specific health care services. The disclosure 14 shall specify if the discounted cash price varies due to 15 different circumstances, including but not limited to the 16 day or time a health care service is provided, the office or 17 location at which the health care service is provided, how 18 quickly an individual pays the discounted cash price for a 19 health care service the individual received, the income level 20 of the individual who received the health care service, or 21 the ancillary services or amenities provided to an individual 22 at the same time the health care service is provided. The 23 discounted cash price shall be available to all covered persons 24 and to all uninsured individuals. 25 b. A health carrier shall post all discounted cash prices 26 via a secure internet site that is easily accessible to all 27 covered persons. A health carrier shall update any change in a 28 discounted cash price within five calendar days of the change, 29 and shall review each discounted cash price at least annually. 30 c. (1) During the appointment scheduling process, and any 31 intake process prior to the provision of a health care service, 32 covered persons and uninsured individuals shall be informed 33 of their right to pay for the health care service via the 34 discounted cash price. 35 -3- LSB 1883XS (6) 90 ko/rn 3/ 11

S.F. 431 (2) During the appointment scheduling process, and any 1 intake process prior to the provision of a health care service, 2 a covered person shall be advised that they qualify for a 3 deductible credit if they have not exceeded their deductible to 4 date, and all of the following are true: 5 (a) The covered person pays the discounted cash price for 6 the health care service. 7 (b) The discounted cash price is below the deidentified 8 minimum negotiated charge for the specific health care service 9 that the covered person will receive. 10 d. A health carrier shall not enter into a contract that 11 prevents the health carrier from offering a discounted cash 12 price below the contracted rates the health carrier has with 13 other commercial or public payors, or that prevents the health 14 carrier from disclosing the health carrier’s discounted cash 15 price under paragraph “b” . 16 e. A covered person’s out-of-pocket pricing for each 17 prescription drug on a health carrier’s formulary shall be 18 available to a health care provider via an easily accessible 19 and secure internet site hosted by the health carrier at the 20 point the health care provider prescribes prescription drugs 21 to the covered person. 22 2. Each health benefit plan shall disclose to the health 23 benefit plan’s covered persons the deidentified minimum 24 negotiated charge for each health care service that is covered 25 under the covered person’s health benefit plan. If a health 26 benefit plan fails to disclose each deidentified minimum 27 negotiated charge, a covered person may substitute a benchmark 28 selected by the commissioner for the deidentified minimum 29 negotiated charge. 30 3. A covered person who elects to receive a covered health 31 care service at a discounted cash price that is below the 32 deidentified minimum negotiated charge shall receive credit 33 toward the covered person’s cost-sharing as specified in the 34 covered person’s health benefit plan, as if the health care 35 -4- LSB 1883XS (6) 90 ko/rn 4/ 11

S.F. 431 service is provided by an in-network health care provider. 1 4. A health benefit plan shall not discriminate in the 2 form of payment for any covered in-network health care service 3 solely on the basis that the covered person was referred for 4 the health care service by an out-of-network health care 5 provider. 6 5. a. If a covered person elects to use a pharmacy discount 7 program, a drug manufacturer’s rebate, or other discount or 8 rebate program that results in a lower cost for a covered 9 prescription drug than if the covered person uses their health 10 benefit plan, the health benefit plan shall apply any payments 11 made by the covered person for the covered prescription drug to 12 the covered person’s cost-sharing as specified in the covered 13 person’s health benefit plan as if the covered person purchased 14 the prescription drug from a network pharmacy using the covered 15 person’s health benefit plan. The health benefit plan shall 16 credit the value of the rebate or other discount toward the 17 covered person’s cost-sharing for health care services that 18 are covered or that are considered formulary under the covered 19 person’s health benefit plan. The health benefit plan may 20 credit the value of the rebate or other discount toward the 21 covered person’s cost-sharing for health care services that 22 are not covered or that are considered nonformulary under the 23 covered person’s health benefit plan. This paragraph shall not 24 be construed to restrict a health benefit plan from requiring a 25 preauthorization or other precertification normally required by 26 the health benefit plan. 27 b. A health benefit plan shall provide a downloadable or 28 interactive online form for a covered person to submit proof of 29 payment under paragraph “a” , and shall annually inform covered 30 persons of their options under this subsection. 31 6. Annually at enrollment or renewal, a health carrier shall 32 provide notice to covered persons via the health carrier’s 33 health benefit plan materials and the health carrier’s internet 34 site of the option, and the process, to receive a covered 35 -5- LSB 1883XS (6) 90 ko/rn 5/ 11

S.F. 431 health care service at a discounted cash price below the 1 deidentified minimum negotiated charge. 2 7. If a covered person pays a discounted cash price that is 3 above the deidentified minimum negotiated charge, the health 4 benefit plan shall credit the covered person’s cost-sharing an 5 amount equal to the discounted cash price. 6 8. a. If a health carrier denies a claim submitted by a 7 covered person pursuant to this chapter, the health carrier 8 shall notify the commissioner and provide evidence to support 9 the denial to the covered person and to the commissioner. 10 b. A covered person may appeal a claim denial to the 11 commissioner within sixty calendar days of the denial. The 12 appeal shall be adjudicated within thirty calendar days of the 13 covered person’s request for an appeal. If the commissioner 14 determines that the health carrier improperly denied the 15 covered person’s claim, the health carrier shall pay the 16 covered person’s costs and attorney fees associated with the 17 appeal, shall accept the covered person’s claim, and shall 18 provide cash compensation to the covered person in an amount 19 equal to the amount of the claim. 20 c. If a health carrier denies twenty or more claims in 21 any one quarter, the commissioner shall have the authority to 22 investigate the denials. If the commissioner finds that a 23 health carrier has improperly denied claims under this chapter, 24 or committed an unfair or deceptive act or practice under 25 section 507B.4, subsection 3, paragraph “u” , the commissioner 26 may conduct a hearing under section 507B.6. 27 9. a. For costs that exceed a covered person’s deductible, 28 the covered person shall have access to a program that directly 29 rewards the covered person with a savings incentive for 30 medically necessary covered health care services received from 31 health care providers that offer a discounted cash price below 32 the deidentified minimum negotiated charge. If a covered 33 person exceeds the covered person’s annual deductible, the 34 covered person’s health benefit plan shall notify the covered 35 -6- LSB 1883XS (6) 90 ko/rn 6/ 11

S.F. 431 person of the savings incentive program and how the savings 1 incentive program works. 2 b. A covered person’s savings incentive for a specific 3 health care service shall be calculated as the difference 4 between the discounted cash price and the deidentified minimum 5 negotiated charge. A savings incentive shall be divided 6 equally between the covered person and the covered person’s 7 health benefit plan, and may include a cash payment to the 8 covered person. 9 c. Savings incentives under this subsection shall not be 10 an administrative expense of the health benefit plan for rate 11 development or rate filing purposes. 12 10. a. A health care provider shall not initiate or pursue 13 a collection action against a covered person, or a covered 14 person’s guarantor, for a debt owed for a health care service 15 unless the health care provider is in material compliance with 16 this chapter on the date that the health care provider provided 17 the health care service to the covered person. 18 b. If a health care provider initiates or pursues a 19 collection action in violation of paragraph “a” , the covered 20 person or the covered person’s guarantor may file for a 21 declaratory judgment with a court of competent jurisdiction 22 and the health care provider shall not continue the collection 23 action against the covered person, or the covered person’s 24 guarantor, while the lawsuit is pending. If the court finds in 25 favor of the covered person, or the covered person’s guarantor, 26 the court shall order the health care provider to do all of the 27 following: 28 (1) Refund a payor any amount the payor paid for the debt 29 that is the subject of the lawsuit. 30 (2) Pay a penalty to the covered person, or the covered 31 person’s guarantor, in an amount equal to the total amount of 32 the debt that is the subject of the lawsuit. 33 (3) Dismiss with prejudice, or cause to be dismissed with 34 prejudice, any court action related to the collection action 35 -7- LSB 1883XS (6) 90 ko/rn 7/ 11

S.F. 431 or the lawsuit. 1 (4) Pay any attorney fees and costs incurred by the covered 2 person, or the covered person’s guarantor, related to the 3 collection action or the lawsuit. 4 (5) Remove or cause to be removed from the covered person’s 5 or the covered person’s guarantor’s credit report any report 6 made to a consumer reporting agency related to the debt that 7 is the subject of the lawsuit. 8 11. Provided that a health care provider does not initiate 9 or pursue a collection action in violation of this chapter, 10 this chapter shall not be construed to prohibit a health care 11 provider from billing a covered person, a covered person’s 12 guarantor, or a third-party payor including a health insurer, 13 for health care services provided to a covered person; or to 14 require a health care provider to refund any payment made to 15 the health care provider for a health care service provided to 16 a covered person. 17 12. If a provision of this chapter or its application to 18 any person or circumstance is held invalid, the invalidity does 19 not affect other provisions or applications of this chapter 20 which can be given effect without the invalid provision or 21 application. 22 EXPLANATION 23 The inclusion of this explanation does not constitute agreement with 24 the explanation’s substance by the members of the general assembly. 25 This bill relates to certain cost controls for health care 26 services and may be cited as “The Patient’s Right to Save Act”. 27 Under the bill, all health care providers (providers) are 28 required to establish and disclose the discounted cash price 29 (cash price) the provider will accept for specific health care 30 services (services). “Discounted cash price” is defined in the 31 bill as the price an individual pays for a specific service 32 if the individual pays with cash or a cash equivalent. The 33 cash price shall be available to all covered persons (persons) 34 and to all uninsured individuals. A health carrier (carrier) 35 -8- LSB 1883XS (6) 90 ko/rn 8/ 11

S.F. 431 shall post the cash prices via an easily accessible and secure 1 internet site, update any change in a cash price within five 2 days of the change, and review each cash price at least 3 annually. 4 During the appointment scheduling process, and any intake 5 process prior to the provision of a service, persons and 6 uninsured individuals shall be informed of their right to pay 7 for the service via the cash price. A person shall also be 8 advised that they qualify for a deductible credit if they have 9 not exceeded their deductible to date, and the criteria in the 10 bill is satisfied. 11 A carrier shall not enter into a contract that prevents the 12 carrier from offering a cash price below the contracted rates 13 the carrier has with other commercial or public payors, or that 14 prevents the carrier from disclosing the carrier’s cash price 15 to persons. 16 A person’s out-of-pocket pricing for each drug on a 17 carrier’s formulary shall be available to a provider via an 18 easily accessible and secure internet site hosted by the 19 carrier at the point the provider prescribes drugs to a person. 20 Each plan shall disclose to the plan’s covered persons the 21 negotiated charge for each service that is covered under the 22 person’s plan. If a plan fails to disclose each negotiated 23 charge, a person may substitute a benchmark selected by the 24 commissioner of insurance (commissioner) for the negotiated 25 charge. A person who elects to receive service at a cash 26 price that is below the deidentified minimum negotiated charge 27 (negotiated charge) shall receive credit toward the person’s 28 cost-sharing as if the service had been provided by a network 29 provider. “Deidentified minimum negotiated charge” is defined 30 in the bill as the lowest cost for a specific service that a 31 provider has negotiated with a carrier for a person’s plan. 32 A plan shall not discriminate in the form of payment for any 33 in-network covered service solely on the basis that the person 34 was referred for the service by an out-of-network provider. 35 -9- LSB 1883XS (6) 90 ko/rn 9/ 11

S.F. 431 If a person elects to use a pharmacy discount program, a drug 1 manufacturer’s rebate, or other discount or rebate program that 2 results in a lower cost for a drug than if the person uses 3 the person’s plan, the plan shall apply any payments made by 4 the person for the drug as detailed in the bill. A plan is 5 required to provide an online form for the purpose of a person 6 submitting proof of payment, and to annually inform persons of 7 their options related to discounts and rebates. 8 Annually at enrollment or renewal, a carrier shall provide 9 notice to persons via the carrier’s health plan materials and 10 on the carrier’s internet site of the option and the process to 11 receive a covered service at a cash price below the negotiated 12 charge. If a person pays a cash price that is above the 13 negotiated charge, the plan shall give the person credit toward 14 the person’s cost-sharing in an amount equal to the cash price. 15 If a carrier denies a claim submitted by a person, the 16 carrier shall notify the commissioner and provide evidence 17 to support the denial to the person and the commissioner. A 18 person may appeal a denial of a claim to the commissioner as 19 detailed in the bill. If the commissioner determines that 20 the carrier improperly denied the person’s claim, the carrier 21 shall pay the person’s costs and attorney fees, accept the 22 person’s claim, and provide cash compensation to the person as 23 detailed in the bill. If a carrier denies 20 or more claims 24 in any one quarter, the commissioner shall have the authority 25 to investigate the denials. If the commissioner finds that a 26 health carrier has improperly denied claims under this chapter 27 or committed an unfair or deceptive act or practice under Code 28 section 507B.4(3)(u), the commissioner may conduct a hearing 29 under Code section 507B.6. If, after hearing, the commissioner 30 determines that a person has engaged in an unfair or deceptive 31 act or practice, the commissioner shall reduce the findings to 32 writing and shall issue and cause to be served upon the person 33 charged with the violation a copy of such findings, an order 34 requiring such person to cease and desist from engaging in 35 -10- LSB 1883XS (6) 90 ko/rn 10/ 11

S.F. 431 such act or practice, and may at the commissioner’s discretion 1 order any one or more penalties, license suspension, or license 2 revocation as detailed in the bill. 3 For costs that exceed a person’s deductible, the person 4 shall have access to a program that directly rewards the person 5 with a savings incentive as detailed in the bill. 6 A provider shall not initiate or pursue a collection action 7 (action) against a person, or a person’s guarantor, for a 8 debt owed for a service unless the provider is in material 9 compliance with the bill on the date that the service is 10 provided to the person. If a provider initiates or pursues an 11 action, the person may file for a declaratory judgment with 12 a court of competent jurisdiction and the provider shall not 13 continue the collection action while the suit is pending. If 14 the court finds in favor of the person, the court shall order 15 the provider to comply with the requirements detailed in the 16 bill. 17 Provided the provider does not initiate or pursue an action 18 in violation of the bill, the bill shall not be construed 19 to prohibit a provider from billing a person, a person’s 20 guarantor, or a third-party payor, including a health insurer, 21 for a service provided to the person, or to require a provider 22 to refund any payment made to the provider for a service 23 provided to a person. 24 If a provision of the bill or its application to any person 25 or circumstance is held invalid, the invalidity does not affect 26 other provisions or applications of the bill which can be given 27 effect without the invalid provision or application. 28 -11- LSB 1883XS (6) 90 ko/rn 11/ 11