Lawmakers pass bill clarifying pay for "temporary hospitals" set up during COVID

Sen. Missy Irvin, District 24, told the committee Senate Bill 621 clarifies that health care facilities designated as temporary hospitals under the federal Hospitals Without Walls program should be paid for services they rendered while operating under that designation.

“I passed a piece of legislation, based on an executive order from governor Hutchinson, and then I followed up with legislation to allow our, facilities health care facilities to become temporary hospitals,” Irvin said, describing the statutory history and explaining the bill’s purpose. She said several ambulatory surgery centers (ASCs) converted to temporary hospitals early in the pandemic but later were not paid for services despite the state law’s intent.

David Mans, speaking for Arkansas Blue Cross, disputed that retroactive payment is legally required. Mans said the 2021 law (Act 723 of 2021) and subsequent court rulings limited any entitlement to a contract effective only after the act’s effective date (Judge Fox ruled any hospital contract could only be effective after 07/28/2021). He said Blue Cross offered alternative rates, entered mediation twice and issued payments in some amounts but that the facilities’ current demands had grown and could be constitutionally barred if made retroactive.

Committee members asked about how many facilities were affected, fiscal impact, and whether payments had been made. Irvin said she believed 1 or 2 ASCs in Jonesboro and Little Rock had participated under the temporary-hospital designation and that some amounts remained uncollected; Mans estimated the disputed numbers for the two facilities were “between 10 and 20,000,000.” Mans told the committee that Judge Fox’s ruling did not grant retroactive pay, so forcing retrospective payments could be unconstitutional.

Representatives pressed insurers on whether the services and CPT codes were the same as hospital claims; Mans responded that ASCs are smaller, do not have ERs and are not equivalent to full-service hospitals, and that Blue Cross sought to set rates comparable to facilities of similar size and scope. Members repeatedly asked whether collection attempts left hospitals with uncollected receivables; Irvin described the unpaid amounts as “uncollected.”

After debate, Representative Baker moved to pass SB 621. The committee approved the motion by voice vote and the chair announced the bill had passed.