Bill would let labor commission set hospital fees

A bill that would allow the Utah Labor Commission to adopt a workers compensation fee schedule for hospital services, similarly to what it does for physician services, is advancing in the legislature.

The House read through S.B. 190 on Friday, after the Senate on Wednesday unanimously passed the measure proponents say would help lower hospital payments, which run higher on average than other states.

Utah lawmakers in 2018 created a study group to investigate hospital costs. The council supported setting hospital rates at some percentage of what Medicare pays, but members could not agree on that percentage.

Allowing the Labor Commission to set rates for hospitals would create more predictability and likely lower costs, proponents have argued.

Utah had the highest average facility payments as a percentage of Medicare among 39 states and the District of Columbia, according to a National Council on Compensation Insurance medical data report released in 2024.

Hospital and ambulatory surgery center payments in Utah in 2023 were, on average, 278% of what Medicare pays. The average across the 40 other jurisdictions that NCCI analyzed was 223% of Medicare’s rate.

NCCI also reported that 30.5% of payments for medical services in Utah went to hospitals, compared to an average of 19.7% across the comparison jurisdictions.

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