Chiaravalloti Introduces Legislation to Require Further Financial Transparency in Hospitals
Bill Package Spurred by the Current Bayonne Medical Center Financial Situation
(TRENTON) – In light of recent news regarding the potential closure of Bayonne Medical Center due to an upcoming hospital merger, of which elected officials had no prior knowledge, Assemblyman Nicholas Chiaravalloti has introduced a three-bill package aimed at increasing hospitals’ transparency to help prevent the abrupt loss of important healthcare services in local communities.
“The Bayonne Medical Center is quite literally vital to the people of this city,” said Chiaravalloti (D-Hudson). “If we had known sooner about a planned merger that could leave residents without access to healthcare, we could’ve had conversations with CarePoint Health to try to determine a better approach. This is why better communication between hospitals and elected officials is so critical.”
The bill package draws upon recommendations in the State Commission of Investigation (SCI) report regarding hospital-related oversight and accountability in New Jersey, after its investigation into CarePoint Health’s financial management.
One bill would give broader oversight capabilities to the Department of Health (DOH) by expanding its Early Warning System, whose purpose is to detect whether hospitals are nearing or already in financial distress. The new legislation would require the system to monitor the quantity and suitability of any fees, allocations and payments made to third parties.
Another bill would allow the Commissioner of Health to notify elected officials if certain hospitals are found to be in financial distress.
Increased transparency would also be required of hospitals when it comes to providing financial information to the DOH. Newly proposed legislation would require non-profit hospitals to share IRS Form 990 and for-profit hospitals to submit equivalent information to the DOH in order to reveal aspects of their revenue and taxation.
Further stipulations would require hospitals to submit information about ownership, leases and rentals of offices and properties. It would also require the identification of investors, business partners and other affiliates while sharing information about projects and ventures financially associated with the hospital.
“With more transparency and oversight, we can prevent hospitals from engaging in questionable business practices that could lead to over-priced medical bills for patients,” said Chiaravalloti. “We can also make sure that no hospital ever reaches a point where their previously undisclosed financial situation is so dire that they are forced to close the facility – leaving community members with a complete loss of access to care.”
The legislation is scheduled to be considered in the Assembly Health and Senior Services Committee next week.