WASHINGTON – Sens. John Kennedy (R-La.), Mike Braun (R-Ind.) and Maggie Hassan (D-N.H.) introduced a bipartisan bill to fix part of the Medicare billing structure that allows hospital systems to charge high hospital rates for care received at off-campus outpatient facilities.

“Hospitals are gaming the system to charge Louisiana patients and taxpayers more for out-patient, off-site care. That’s wrong, and I’m proud to work with Sens. Braun and Hassan to make it right by correcting Medicare’s billing policy,” said Kennedy.

“Hoosiers know our health care system is broken, and one problem we can fix right now is services at off-campus outpatient facilities being billed to Medicare at higher hospital rates. Fixing this problem will save taxpayers 40 billion over the next decade, and this bill will apply some of those savings to fixing our nursing shortage by creating a new program to pay for training,” Braun said. 

“Granite Staters who have been going to the same doctor for years are experiencing sticker shock when a hospital acquires a doctor’s office or clinic and all of a sudden starts charging extra fees for the same services. Our bipartisan bill takes on the health care industry to eliminate unfair fees, lower costs for patients, and save taxpayer dollars—and then we use those savings to invest in the health care workforce. Lowering health care costs for Americans is a bipartisan priority, and I urge my colleagues on both sides of the aisle to support this commonsense bill,” said Hassan.

Due to Medicare’s billing structure, even if care is received at an off-campus outpatient facility, patients can receive bills that treat the care as if it was provided at a main hospital campus. This means the providers are charging patients and Medicare higher “hospital” rates when patients aren’t receiving in-patient care. 

The consequences of this artificial price hiking are expanding as hospitals acquire more and more small physician-owned practices and off-campus facilities. In 2020, the Congressional Budget Office estimated that, over the next decade, taxpayers will pay close to $40 billion in excess Medicare costs due to exorbitant facility fee payments.

 A provision in the 2015 Bipartisan Budget Act makes these price inflations possible because that law established “site-neutral” payments under Medicare for services received at off-campus outpatient departments, but it exempted most hospitals.

The SITE Act would end the 2015 Bipartisan Budget Act’s site-neutral exceptions. It would also prevent off-campus emergency departments from charging higher rates than on-campus emergency departments when standalone emergency facilities are located in close proximity to a hospital campus. 

The bill would require health systems to establish and bill using a unique National Provider Identifier number for every off-campus outpatient department. It would direct the Department of Health and Human Services to treat outpatient departments as subparts of the parent organization and to issue these subparts unique provider identifiers. The SITE Act would also remove liability for services rendered for payers who are not billed in accordance with this section’s requirements.

The bill would use a portion of the overall savings from this fix to help fill the nursing shortage by creating a graduate nursing education program that would provide payments for training costs. 

Text of the SITE Act is available here.

WASHINGTON – Sen. John Kennedy (R-La.) today introduced the Tracking Bad Actors Act to create a public database of people who have committed financial crimes or have civil liability for financial misdeeds. Sen. Cynthia Lummis (R-Wyo.) is an original cosponsor of the bill. 

“Financial fraudsters prey on everyday investors like vultures, and Americans deserve to know who has a track record of breaking securities laws. The Tracking Bad Actors Act would help expose these offenders to protect American families and workers from financial fraud,” said Kennedy. 

“People in Wyoming deserve to know if their financial manager or accountant has broken the law. The Tracking Bad Actors Act  will give consumers much needed transparency into the financial sector. I’m proud to partner with Senator John Kennedy on this commonsense legislation to protect Wyoming investors from those with bad intentions,” said Lummis. 

The Tracking Bad Actors Act would require the federal government to create a public database of bad actors convicted or held criminally or civilly liable for securities violations. This database would allow investors and brokerage firms to guard against people known to have engaged in fraud. 

This information would be made available to the public, free of charge. To the extent practical, the bill would require the database to contain all enforcement actions agencies have taken. 

The database would be operational within three years of the bill’s becoming law. 

Text of the Tracking Bad Actors Act is available here.

WASHINGTON – Sen. John Kennedy (R-La.) today introduced the Sponsor Promote and Compensation (SPAC) Act, which would provide greater transparency for investors involved with Special Purpose Acquisition Companies (SPACs), also known as blank-check companies. 

“Celebrities are often the public face of SPACs, helping the companies sell shares to hardworking Americans who may not understand the risks associated with SPACs. So, it’s right and fair that SPACs should disclose how theirs sponsors get paid and how that affects the value of the shares that main street investors are holding. My bill would require this kind of transparency,” said Kennedy.

SPACs raise investor funds through an initial public offering (IPO) with the goal of acquiring and merging with a private company within a two-year window. The SPAC formula is attractive because it permits companies to go public on a U.S. stock exchange without the delays and demands of a traditional IPO, allowing them to avoid liability and disclosure regulations.

Fifty percent of all IPOs in the U.S. in 2020 involved SPAC structures, and SPACs raised $82 billion in the same year. In the first three months of 2021, SPACs outpaced traditional IPOs, raising $95 billion in that time.

When a SPAC proposes a merger with a private company, current SPAC shareholders can choose to redeem their original SPAC shares for money plus interest rather than participate in the merger by acquiring new shares in the merged company. If a SPAC fails to complete a merger within two years of its creation, it liquidates and returns all funds to its shareholders, with interest.

Wall Street executives, celebrities and other public figures often serve as the founders and sponsors of SPACs. They act as the public face of the company, use their influence to fundraise through share offerings, promote the company and help identify a private company with which to merge. 

Most SPAC sponsors award themselves “founder shares” that convert into public shares after the merger between the SPAC and a private company. The founder shares typically represent as much as 20 percent of the total share value of the company. 

This type of compensation does not exist as part of traditional IPOs. When SPAC sponsors convert the shares that they receive in the merged company, the public’s shares of that company are diluted and lose value. The valuation of SPAC shares may fall even further if a SPAC sponsor chooses a weak company with which to merge.

Some market experts have called for SPACs to make their compensation structures more explicit in order to protect retail investors. 

Within 120 days of its enactment, the SPAC Act would require the SEC to issue rules on enhanced disclosures for SPACs during the initial public offering stage and the pre-merger stage to make those disclosures more transparent to investors, especially main street investors. These measures would help investors make more informed decisions about a company’s shares.

Text of the SPAC Act is available here.

WASHINGTON – Sen. John Kennedy (R-La.), a member of the Senate Appropriations Committee, today announced $2,006,964 in Federal Emergency Management Agency (FEMA) grants for Louisiana disaster aid.

“I’m grateful to see this $2 million being used to help the folks at Houma’s Leonard Chabert Medical Center repair their facility,” said Kennedy.

The FEMA aid will fund the following:

• $2,006,964 to the Ochsner Clinic Foundation at the Leonard Chabert Medical Center to repair damages as a result of Hurricane Ida.