Nonprofit Hospitals Said to Overcharge Uninsured

[Guest guest]

We live more and more in a predatory society. Our nonprofits act in predatory

ways. A lot of our charities are predatory beneath their altruistic facades.

 

Our governments act in predatory manners to it's own citizens Our large

corporations are some of the most predatory organizations in the world.

 

That is all reflected in the way that we live our lives with each other. It

affects all the areas of our lives. It comes from the top down.

 

It is reflected in our popular cultures of music, movies, TV, games, etc. We are

becoming something truely sick and that standard is more and more accepted as

" normal " .F.

 

 

 

http://www.nytimes.com/2004/06/17/business/17suit.html?th

 

June 17, 2004Nonprofit Hospitals Said to Overcharge UninsuredBy REED ABELSON and

JONATHAN D. GLATER

 

Agroup of plaintiffs' lawyers filed civil lawsuits against more than a dozen

nonprofit hospitals across the country yesterday, contending that the hospitals

violated their obligation as charities by overcharging people without insurance

and then hounding them for the money.

 

The complaints name some of the largest hospitals in the Chicago, Atlanta and

Minneapolis metropolitan areas. More lawsuits are expected to be filed, said Don

Barrett, one of the lawyers involved in the cases. " It is part of a coordinated

attack on this reprehensible practice, " he said.

 

The lawyers, some of whom were involved in litigation against the tobacco

companies in the 1990's, are calling for the creation of a trust that would be

financed by the hospitals and would provide affordable medical care for those

without insurance. Because the hospitals have tax-exempt status and other

benefits as nonprofit organizations, the lawyers argue that they have an

obligation to provide affordable care to the uninsured.

 

Hospitals' billing and collection practices have emerged as a controversial

issue over the last 18 months as many hospitals have come under sharp criticism

for charging people without insurance significantly more than they charge those

insured, and then aggressively seeking to collect payments from those people.

 

" It has brought on them the wrath of the community over their tax exemption, "

said Dr. Uwe E. Reinhardt, a professor of economics and public affairs at

Princeton University.

 

The suits were filed in federal courts perhaps because they cite federal laws

that govern health insurance. The lawyers are seeking class-action status on

behalf of uninsured patients who they say should have received affordable care

but did not.

 

The lawyers also say the hospitals are sitting on large, untaxed sums that

should help pay for care for the uninsured. Some hospitals are described in the

suits as being among the most profitable hospital systems in the nation with

hundreds of millions, even billions, in assets and revenue.

 

But the hospitals say they are not responsible for the plight of the uninsured.

And they say that in seeking repayment by people without insurance, they are not

charging unfairly high rates but are simply charging prices that do not reflect

the negotiated discounts obtained by insurance companies and health maintenance

organizations. Many say they are reviewing their billing and collection

practices.

 

The lawsuits are " baseless and misdirected, diverting focus away from the real

issue of how we as a nation are going to extend health coverage to all

Americans, " said Alicia Mitchell, a spokeswoman for the American Hospital

Association, a trade group in Washington.

 

There is little doubt that people without insurance are frequently charged the

highest prices for care. The uninsured do not benefit from the ability of an

insurer, health plan or large employer to negotiate low prices for care, and

hospitals have typically charged their list price to people without insurance.

 

One suit filed in Chicago named Provena Health. " While Provena gives private

insurance companies and governmental third-party payers like Medicare and

Medicaid large discounts off this gross or 'sticker price,' '' the suit said,

" all of its uninsured patients are charged 100 percent of the full sticker

price, which is two to three times more than Provena charges its insured

patients for the same service. "

 

The lawsuit claims that Provena each year charges uninsured patients at least

$50 million more than its insured patients. The suit does not indicate, though,

what portion of the hospital's patients are insured.

 

" In reality, Provena is anything but charitable, " the lawsuit said. " While it

promises to provide affordable care to the uninsured poor, Provena has and

continues to engage in a practice and pattern of charging inordinate,

unreasonable and inflated prices for medical care to its uninsured patients. "

 

No one from Provena could be reached late yesterday for comment.

 

Provena, like some other hospital chains around the country, is already facing

scrutiny from regulators. Earlier this year, Illinois revoked the tax-exempt

status of one of its hospitals for, among other reasons, not providing enough

charitable care.

 

Other state attorneys general have cited similar practices in bringing lawsuits

against some nonprofit providers. In Connecticut, the attorney general, Richard

Blumenthal, brought a suit against Yale-New Haven Hospital. In New York,

hospitals' handling of uninsured patients is an issue of concern to Eliot

Spitzer, the state's attorney general, said Christine Pritchard, a spokeswoman

for his office.

 

" The office has received complaints from uninsured individuals related to debt

collection for their hospital care, " Ms. Pritchard said. " It is of concern to

our office, and we would encourage any individual in a similar situation to

contact our consumer help line. "

 

The lawsuits filed yesterday describe aggressive efforts by the hospitals to

obtain payment from uninsured individuals without the means to pay.

 

The suit filed against Advocate Health Care Network of Oak Brook, Ill., for

example, asserts that Jannie Watts, one of the plaintiffs, " received numerous

threatening and harassing phone calls " seeking payment of $48,008.47 for

treatment of her uninsured teenage son, a bystander to a shooting who was hit by

multiple gunshots in 1998.

 

Similarly, in a suit brought against Allina Health System in Minneapolis, the

plaintiff, Paul Kern, argues that he had no insurance and thought his care was

free. Instead, the suit says, he was billed the full cost of the care and he

turned to a credit counseling service, which was unsuccessful in its attempts to

negotiate with the hospital on his behalf for better terms.

 

A spokeswoman for Allina said the hospital had not seen the lawsuit and could

not comment.

 

Hospitals say they can ill afford to finance free health care. Many say that

they are struggling financially and that whatever assets they have they need to

invest in improving the quality of care. These lawsuits would drain already

limited resources, said Ms. Mitchell of the hospital association.

 

The issue of hospitals' treatment of the uninsured is likely to continue drawing

attention from lawyers and policy makers, said Eugene E. Elder, a lawyer in the

Washington office of Akin Gump Strauss Hauer & Feld who has represented

hospitals. As more people have direct experience with the high price of hospital

care, he said, they are sympathetic to those with medical bills they cannot pay.

" More and more people have become sensitized to that, " he said, " and it's easy

to get outraged. "

 

It is unclear how strong the new legal cases will prove to be, said Samuel

Issacharoff, a professor at Columbia Law School who has worked with both

plaintiff and defense lawyers. " There are a couple of moving parts that are hard

to define, " Mr. Issacharoff said. " What is the legal obligation to provide

charity care? "

 

Determining exactly who should have been charged less or received treatment free

may be difficult, he said, and deciding how much money they should have been

charged for treatment may be equally complex. " This is a terribly complicated

issue, " Mr. Issachroff said.

 

Copyright 2004 The New York Times Company