SB 342, An Act Concerning Health Coverage

TESTIMONY OF THE CONNECTICUT HOSPITAL ASSOCIATION
SUBMITTED TO THE INSURANCE AND REAL ESTATE COMMITTEE

Tuesday, March 3, 2026

The Connecticut Hospital Association (CHA) appreciates this opportunity to submit testimony concerning SB 342, An Act Concerning Health Coverage.  

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.

CHA opposes Section 1 of the bill, which requires “site-neutral” payment policies that would have devasting consequences for patients in underserved communities and Connecticut hospitals.  These policies would require providers and health insurers to use equal reimbursement rates for all contracting healthcare providers in the same geographic region and to reimburse providers for outpatient services using specific medical codes at the same rate, regardless of where the service is provided.  We believe this section of the bill is unnecessary and will have unintended consequences on hospitals’ and health systems’ ability to provide lifesaving, around-the-clock care to all patients, especially in underserved communities.

Given their unique role, while treating sicker and lower-income patients, hospitals are held to higher licensing, accreditation, and regulatory standards than independent physician offices and ambulatory surgical centers.  Hospitals must be prepared and equipped to provide emergency care 24/7, serve as a safety net provider for vulnerable populations, respond to natural and man-made disasters, and more — and they must cover the costs of complying with these requirements through their direct patient care revenue.  Provisions for site-neutral payments, such as the one outlined in Section 1 of this bill, disregard the economic headwinds that Connecticut hospitals are currently facing and fail to recognize the fundamental differences between hospital outpatient departments (HOPD) and other sites of care.

Now more than ever, hospitals need stable and adequate reimbursements for what is a highly challenging environment.  Connecticut hospitals cannot withstand policies intended to erode the ability to care for patients and undermine the financial health of the sector.

Section 2 amends existing state law to further define “anti-steering clause” to include any utilization management provision and potentially other undefined contract clauses and provisions.

We appreciate the interest of the committee in advancing policy affecting the negotiations between commercial health insurance companies and healthcare providers.  CHA has been an active participant in those policy discussions.  Just three years ago, CHA worked closely with members of this committee when it advanced legislation prohibiting “anti-steering,” “anti-tiering,” “all-or-nothing,” and “gag clauses” in commercial health insurance contracts.

We are concerned that the change to “anti-steering clause” as drafted is overly broad and could result in unforeseen consequences that could impact patient care.  We are unclear of the genesis of the suggested change and would appreciate the opportunity to better understand the intent behind the provision.  Until we are able to better understand this provision, we unfortunately must oppose this change.

We support Section 4, the concepts described in Sections 6 and 7, and Sections 8 and 9.  We support the bill’s recognition of the importance of clinical peer review in the adverse determination process rather than a sole reliance on artificial intelligence (AI) or an algorithm.  We are supportive of the legislation’s provisions in sections 6 and 7 to create a presumption that care called for by a provider is medically necessary; however, we encourage the committee to broaden the provision so there is a presumption that all care called for by a provider is presumed to be medically necessary, rather than just the care prescribed by a provider in an insurance company’s highest tier.  The burden should rightfully be on the insurer to demonstrate otherwise. Finally, we support Sections 8 and 9 of the bill, which prohibit step therapy for the treatment of disabling or life-threatening chronic diseases.

Finally, we understand the intent of Section 5 is to ensure as little disruption as possible to an individual health insurance policyholder’s care when a dispute between a health insurance company and provider cannot be resolved and either party seeks to terminate or not renew a contract.  Unfortunately, as constructed, the bill is administratively unworkable.  We would welcome the opportunity to further discuss the intent of the provision with the committee and determine if there is a path forward to support patient care and maintain a fair playing field for negotiations between providers and health insurance companies. 

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