SB 496, An Act Concerning Uncompensated Care

TESTIMONY OF THE CONNECTICUT HOSPITAL ASSOCIATION
SUBMITTED TO THE HUMAN SERVICES COMMITTEE

Tuesday, March 17, 2026

The Connecticut Hospital Association (CHA) appreciates this opportunity to submit testimony concerning SB 496, An Act Concerning Uncompensated Care.  CHA opposes the bill as written.

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.

SB 496 establishes a voluntary hospital financial assistance program that would create new requirements for hospital financial assistance policies for hospitals that choose to participate.  CHA appreciates the committee’s continued focus on helping patients manage the cost of care, but we have concerns with the bill’s provisions.  Similar policies have been proposed and discussed in recent years and raise significant operational and financial concerns for hospitals.  Connecticut hospitals already provide extensive financial assistance and free care programs for low-income patients, including individuals who fall within the income ranges associated with programs such as the Supplemental Nutrition Assistance Program (SNAP) and the Women, Infants, and Children (WIC) Nutrition Program.

The proposal to automatically extend financial assistance eligibility based on participation in these programs is therefore largely duplicative of existing hospital policies and may create administrative complexity without meaningfully improving access to assistance.  In addition, the bill would prohibit hospitals from considering patient assets when determining eligibility for financial assistance and would limit hospital collections to no more than two percent of a patient’s annual household income.

Together, these provisions represent a significant departure from existing financial assistance frameworks and effectively shift the cost of inadequate insurance coverage and patient cost-sharing obligations onto hospitals.  Hospitals remain committed to working with patients to resolve medical bills and connect eligible individuals with coverage programs, but policies that impose rigid statutory collection limits or restrict reasonable eligibility criteria could undermine hospitals’ ability to sustain these programs while continuing to provide care to all patients regardless of their ability to pay.

In addition, although we greatly appreciate the interest in addressing additional uncompensated care costs that might result from federal policy changes, we have concerns about conditioning disproportionate share hospital (DSH) payments on adoption of these financial assistance policies.  Under federal Medicaid DSH rules, each hospital is subject to a hospital-specific DSH limit, and the availability of DSH must be evaluated together with other Medicaid reimbursement, including supplemental payments, when determining whether additional DSH capacity exists.  

As a result, DSH may not be available, or available in the same amount, for all hospitals that adopt these proposed financial assistance policies.  This creates a risk that DSH would be an uneven and potentially inequitable mechanism for supporting new uncompensated care costs.  We instead propose that the state consider establishing a dedicated and stable funding pool for hospital uncompensated care payments that is not contingent upon participation in a voluntary financial assistance program.

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