Payment due (Hospital defends lawsuits against those who don't pay)

sacbee ^ | 9-26-04 | will evans

[LouAvul]

Mercy Healthcare Sacramento is the most aggressive local hospital chain when it comes to collecting unpaid bills from the poor and uninsured, yet it enjoys the same tax breaks and financial perks all of the county's nonprofit hospitals get by promising to provide charity care.

.snip.

Mercy, owned by Catholic Healthcare West, filed four times as many collections cases in the local court and sought 11 times more in total payments as any other health care system operating in the Sacramento market.

.snip.

We are not a finance company," said David Amos, the CHW executive who oversees patient financial services for Mercy. "Our mission is to provide care to everybody in the community who needs it. To do that, we have to be paid."

[LouAvul]

The feds require hospitals treat anybody who shows up at the ER. Many, mostly illegals, use the ER for their primary care provider for colds and flu.

Then, the hospital can't pursue for payment if the people can't pay.

Sorry. But medicine is a business, not an entitlement.

[linn37]

All they have to do to avoid collections is make a monthly payment.

[Kozak]

If the hospital can't pay it's bills the lights go out and the doors close.

Does the Sac Bee give away it's papers? The poor need news too....

[cyborg]

That's what I do.

[AndyJackson]

There is an issue here - this is a "religious" hospital - meaning that it is given tax breaks in return for its service to the community. What is at stake is a decision to start revoking preferential tax treatment for these types of hospitals.

[Mears]

Pardon my ignorance here,but I didn't think a collection agency could garnish wages. A lien on a home maybe,but can they take wages?

I thought only the IRS and State Depts of revenues could garnish wages.

[Caipirabob]

There are several articles here at FR, one very recent on hospitals that are declaring bankruptcy and closing their doors. The recent article was on how one Southern CA hospital in a poor section of town was finally packing it in and shutting down. The author interviewed several people who lamented "Where will we go now" and how "immigrants" will be denied access to proper healthcare.

Of course they will always be able to go somewhere else, but in all likelyhood it will turn out similar to the above operation.

At any rate, in these closures we are seeing the true price of unmonitored illegal immigration. It's having an impact which is unspoken by those in Washington while the sociliast wail about the increasing price of healthcare and promise paid prescriptions to anyone who will vote for them.

It will become far worse before it gets better.

[nothingnew]

Pardon my ignorance here,but I didn't think a collection agency could garnish wages.

As far as I know they can't garnish wages, but they can go after personal bank accounts if they have a judgement.

FMCDH(BITS)

[sgtbono2002]

If they get your personal bank account many times they have your wages as many people get direct deposit. If they garnish your personal account and you have direct deposit you are dead meat, you wont even be able to buy milk for your kid. This makes Military dependents especially vulnerable.

[baltodog]

...and I say, pay attention to your bills very carefully.

We had a $108.00 charge that I was going to pay, no questions asked.

Well, my wife asked...it was a write-off for a 45-second eye test that my son took as part of a physical. We don't have eye coverage. It's spelled out on our insurance cards.

The hospital decided to bill us anyways, for services that they were not required or asked to perform.

We fought for 3 weeks. Our human-resources director finally called the hospital and let them know that charging patients like this was illegal.

Fair is fair. I have no sympathy for our medical system.

[NewRomeTacitus]

That's what I do.

Well I hope you don't get purposely sick just to get your money's worth. Wait, that's my Scottish genes kicking in. I regularly injure myself trying to get that last scrap of toothpaste out of the tube.

[Cboldt]

There is an issue here - this is a "religious" hospital - meaning that it is given tax breaks in return for its service to the community. What is at stake is a decision to start revoking preferential tax treatment for these types of hospitals.

While it may have Catholic roots, it is a non-profit hospital, not a "religious" hospital. Patients who don't want to pay can go to for profit hospitals, that have the same obligation to treat ER patients. This hospital likely "qualifies" people for charity under some pre-arranged rules.

As far as I can tell, nobody is asserting that the hospital is going after the charity cases for payment, and nobody is asserting that the hospital is not holding up its end of the bargain as far as taking charity cases. The gravamen of the article is that the hospital is aggressive in pursuit of people who agreed to pay for services, then reneged.

If the hospital can't afford to operate, it will close. Simple, but extreme solution. Another is to renegotiate the terms, or legislate that non-profit hospitals do not have the power to sue deadbeats.

[AndyJackson]

Wrong. One of the things that has become an issue in many communities is that "non-profit" hospitals are much more aggressive in their collection practices than "for profit" hospitals, meaningn that they are much quicker to file lawsuits rather than work out an accommodation with their patients. Given these facts, communities are certainly entitled to review the reasons why they have been given tax advantages over "for profit" hospitals. After all, in a free market, each participant ought to be treated exactly the same, shouldn't they?

[Cboldt]

Wrong. One of the things that has become an issue in many communities is that "non-profit" hospitals are much more aggressive in their collection practices than "for profit" hospitals, meaningn that they are much quicker to file lawsuits rather than work out an accommodation with their patients.

So what? It just means the for profit guys have adequate margin to support negotiation. It doesn't mean the HAVE TO negotiate.

Given these facts, communities are certainly entitled to review the reasons why they have been given tax advantages over "for profit" hospitals. After all, in a free market, each participant ought to be treated exactly the same, shouldn't they?

I agree that the community sets the rules. In this case, I have heard no allegation that a rule was breached.

I don't know what you mean by "each participant ought to be treated the same," but I figure each consumer has a choice of hospitals. Now that the community has wind that the non-profiit will sue for payment, customers can avoid that hospital, and choose instead the hospital that will negotiate a lower price when the customer doesn't pay.

At some individual/consumer income level, statutory "charity" status kicks in, and the customer is entitled to "free" treatment.

[Smokin' Joe]

We were making monthly payments, all agreed upon, for over a year. The payments were in the agreed upon amount, on time, and the check never bounced.

Even though we had continued to make the agreed upon payment, we were contacted by a collection agency. Mercy Hospital had sent us to collections, and when contacted, cited a letter (which we never received) which had supposedly (unilaterally) changed the terms and doubled the payment, and we were told that we were now in arrears. Supposedly, the payment was increased unless we complained.

A number of other people in town had the same thing happen to them.

No one here was asking for an entitlement, all the people I know of were paying as per their original agreement with Mercy.

I also used to donate at their fundraisers. Never Again.

IMHO, if they are going to be a business, pay taxes like I do.

[JustTheTruth]

The IRS has regulations that determine whether not-for-profit (IRS code 501 (c) 3) hospitals deserve tax exemption. In short, they must serve a community benefit purpose - but that doesn't mean they are unable to aggressively go after payment that is rightfully due for services provided.

Part of the problem is that hospitals across the country are in an antiquated and complex payment system and none of them individually can change it. It is like buying a car - with high sticker prices that don't match reality - only much, much worse - and it worsens annually. Hospitals negotiate discounts with insurance companies, in many communities, are about 70% discounts. Total cost is a little less than 30% of charges for many. Inpatient stays are paid by insurance companies on a "per day" flat rate basis and by Medicare as a flat "per case" basis.

In many communities, however, hospital outpatient services, such as Emergency Department services or x-rays or CT scans are paid by insurers as a percentage of billed charges - perhaps more than a 70% discount.

The problem from a "social equity" standpoint is that often the people who can afford hospital care the least (the uninsured) are those who can get stuck with paying the most - 100% of charges. More enlightened hospitals have generous "charity care" policies that provide discounts to the uninsured based on a sliding scale - giving big discounts to people who make as much as 400% or 500% of the Federal Poverty level. However, if you make, say 600% of the Federal Poverty level and you have no insurance, you could get stuck with the full hospital bill (or if you are unlucky enough to go to a hospital without a more generous charity discount policy), you could lose your house for a surgery with a bill of $100,000 and a full cost of something less than $30,000 to the hospital. It is hard to argue that is really appropriate or equitable, and this fact is the reason that there is now a major national class-action lawsuit against hospitals such as Catholic Healthcare West, owner of the hospital cited in this post.

It is true that way too many people think that healthcare is or should be an entitlement; that healthcare costs much more than many people can afford; that there are some who could afford health insurance who choose to put their money elsewhere; that many use hospital Emergency Departments for inappropriate reasons, and that illegal immigrants (aliens) are a burden on hospitals in border regions. At the same time, it is a complicated situation and I haven't heard any great solutions from anyone.