HB 5241, An Act Establishing A Triple Bottom Line Justice Demonstration Pilot Program

TESTIMONY OF THE CONNECTICUT HOSPITAL ASSOCIATION
SUBMITTED TO THE PUBLIC HEALTH COMMITTEE

Monday, February 23, 2026

The Connecticut Hospital Association (CHA) appreciates this opportunity to submit testimony concerning HB 5241, An Act Establishing A Triple Bottom Line Justice Demonstration Pilot Program.  CHA appreciates the committee’s desire to examine innovative approaches to integrate environmental remediation, community engagement, and healthcare delivery to address the impact of environmental and climate stressors on the health of disproportionately impacted communities. But the bill’s focus on Z-codes, without more structure and careful implementation planning, is concerning.

Connecticut hospitals make our state stronger by delivering nationally recognized, world-class care, supporting jobs and economic growth, and serving communities across Connecticut.  Every day, hospitals improve access, affordability, and health equity — providing care to all patients regardless of ability to pay.  At the same time, hospitals invest in their workforce and local communities, even as they navigate significant financial and federal challenges.

HB 5241 as drafted directs the Department of Public Health commissioner to (1) identify relevant ICD-10 Z codes (Z-codes); (2) develop a plan to increase utilization of such codes to at least twenty percent of all health insurance claims submitted for reimbursement; and (3) design and implement an education program for healthcare providers, hospital systems, patients, and communities regarding the use of Z-codes.

By way of background, ICD-10 is the International Classification of Diseases, 10th Revision, which is one of the HIPAA-compliant billing code sets that providers are required to use. ICD-10 has been used in the United States since 2015. The “Z codes” are a subset of the ICD-10 code set that include codes for non-medical factors that may influence a patient’s health status but are not primarily medical in nature.  These factors are also known as social influencers of health (SIOH) or social determinants/drivers of health (SDOH). SDOH factors might include a person’s socioeconomic situation, level of education and literacy, employment status, housing situation, flag a lack of adequate food or water and can capture occupational exposure to risk factors like dust, radiation, or toxic agents.

It is important to note that these Z-codes are generally supplemental diagnosis codes and are not to be used as the admitting or principal diagnosis codes, and they do not track the medical reason for the visit. It is widely known in the healthcare industry that Z-codes are not the best method to capture SIOH/SDOH information because they are very limited in scope and applicability.  Hospitals in Connecticut already utilize more sophisticated systems and resources than Z-codes, having already made significant investments in screening for and documenting social drivers of health that recognize a wide spectrum of issues, including the importance of environmental and climate-related factors impacting patient and community health.

As the committee considers this proposal, CHA respectfully urges that (1) hospitals be directly involved in the planning and design of any pilot or program that promotes or requires Z-codes (2) that any requirements not negatively impact reimbursement or interfere with medical care, and (3) any utilization targets for Z-codes be feasible, reasonable, and voluntary.

While CHA recognizes that Z-codes have a role in gaining population health insights, additional clarification is needed to understand how increased utilization of Z-codes would help providers or patients. For example, lines 33-35 of the bill expressly state that one goal of the bill is to “support the use of ICD-10 Z codes to assess the potential to generate additional resources to support health care for communities experiencing environmental and climate stressors.” Because Z-codes do not increase healthcare reimbursement, this goal is confusing and needs further clarification. There should be concrete solution-based goals tied to the use of Z-codes, including more clarity of how the use of Z-codes will generate or be used to generate additional financial resources, or assist in payment reform discussions, or help with improving the Medicaid program or federal approvals. Clarifying this linkage would help ensure a pilot or program is valuable – otherwise collection of these data is likely a burden for providers with little upside for patients.

We oppose percentage-based utilization benchmarks applied across all claim types. Z-code reporting depends on patient screening, documentation, and clinical appropriateness which will vary by setting, patient, and population. A pilot program that promotes appropriate, evidence-based utilization of Z-codes is a better approach as it allows for alignment with national coding standards and compliance requirements while still advancing the bill’s goals – without interfering with patient care or established reimbursement requirements. 

Finally, hospitals and health systems would be the primary users of any education initiative and any documentation or workflow changes associated with increased Z-code reporting.  Hospitals should be included in the planning and design of both the pilot program and the education initiative. The inclusion of multi-disciplinary hospital experts early in the process will help ensure alignment with federal coding and billing requirements, minimize unintended claim denials or compliance concerns, and support practical implementation within existing clinical workflows.

CHA welcomes the opportunity to work collaboratively with the Department of Public Health, the Department of Energy and Environmental Protection and the General Assembly to refine this proposal to achieve the shared objectives in a sustainable and operationally feasible approach.  

Thank you for your consideration of our position.  For additional information, contact CHA Government Relations at (203) 294-7301.