Are nonprofit hospitals gouging the poor?

[davsand]

Here you go--one of the BEST articles I've seen that explains a bit about what is going on in the healthcare industry right now.

I have been hip deep in this issue for a few years now, and I am AMAZED to finally see an article that puts it in terms a lot of people might be able to absorb.

I know some people inside a couple of the Scruggs cases, and I can tell you that they are sincere in what they are trying to do. I also can tell you that the only changes we will EVER see in our health care system will be the ones we FORCE on that industry.

Please, read this article and send it on to people you know. We all have to be working to change this. If we want to ever see the day when hospitals act like charities we had better get busy...


http://www.msnbc.msn.com/id/6882630/

"...Forty-six suits have been filed in 22 states, including one against Virginia's Inova Health System, alleging the hospitals violate their tax-exempt status by charging uninsured patients the highest rates and employing abusive tactics to collect.

"Their goal is to discourage these uninsured patients from returning," said Richard F. Scruggs, the lead attorney. "If they paid taxes, I couldn't complain. But these hospitals are given freedom from taxation for doing something."

Included in the cases is a California hospital with $1 million in an offshore bank account, another in Louisiana that owns a luxury hotel and health clubs, and a Georgia hospital that flew its executives on private jets to meetings in the Cayman Islands and Florida's Amelia Island. Because private insurers and the government negotiate deep discounts for their clients, the uninsured are usually the only ones charged the list price — up to six times as much as for insured patients..."

How many of you knew about the Scruggs class action lawsuits and everything else going on with hospitals (including property tax exemption challenges)? Are they going on in your area?


Laura

[rogue_bandit]

1. Mental Health Parity

I don't know what's going on locally, but I do know that we took a poor friend suffering from serious mental illness in to the emergancy room on a cold, snowy night. They treated her like dirt, eventually she walked away and they didn't care. She was suffering from paranoia, in addition to voices, so they sent down three security guards to help her out...couldn't send a counselor or someone with compassion.

In our area, this is the only place to take someone suffering from mental illness. The county actually pays for something like eight beds all year round to help these people, and the hosptial gets special use of bonds in the city's name, and they get property tax relief and non-profit status.

They compete with another nearby hospital. Our town is a regional medical center. We have more sophisticated scanning devices per capita than any place in the northwest.

Ugly.

[Lindsay]

2. It just REALLY frosts me

that the government and media waste our time lying about a "crisis" in Social Security, while a real crisis in healthcare availability is downplayed or ignored.

Mental health is a big issue for me as well. I have suffered from major depression and anxiety off and on since high school, and the cost and (lack of) availability of treatment is not helping matters any.

[ynksnewyork2]

3. nothing new. it's been going on

for years.

[Sgent]

4. Ask me anything

Thoe hospital spoken of in the article is North Mississippi Medical Center. Although not on staff there, I know work with them on a variety of issues (and against them on others). They are actually one of the better that I've seen.

The real reason they reversed on the settlement is because of the conflict of interest issues. Probably 50% or more of the board does a significant amount of business with the hospital. In a small town, this is probably inevitable if you want community leaders on your board; however, in this case it is very extreme. Many of the board members have businesses who ONLY do business with the hospital system.

[davsand]

6. That is not an uncommon set up.

Seems like the folks on a lot of the Boards of hospitals end up doing a lot of business with those same hospitals. Makes me wonder just who is watching the store, and probably would raise more than a few tax payer eyebrows if people realized just how much money hospital boards make off the local community non-profit hospital.

It is a shame that agreement de-railed. We had been watching that with some interest. I know the bond ratings guys had really supported that hospital BECAUSE of that agreement. I have to wonder if they will revise those financial ratings downward now that the agreement is DOA.


Laura

[Dastard Stepchild]

5. Are you involved in health policy research/advocacy/service provision?

I ask because this is my area of focus in grad school, and I am always excited to meet others that have similar general interests in health care issues. :)

[davsand]

7. Pleased to meet-cha!

I kind of fell into this issue, and have stayed active with it... I must not be doing too badly with it--I've pissed off a lot of folks thus far.

Check your in-box, I sent you a PM.


Laura

[Dastard Stepchild]

16. Back at ya!

I have replied to your PM :)

[proudbluestater]

8. It needs more cow bell n/t

[Dastard Stepchild]

17. If only this were the solution to everything in life...

More cowbell.

[proudbluestater]

9. I've heard all hospitals overcharge those with no insurance

Not just non-profits.

"Because private insurers and the government negotiate deep discounts for their clients, the uninsured are usually the only ones charged the list price — up to six times as much as for insured patients..."


This is probably for another thread, but what irks me is the FOR profit hospitals that compete to see who can have the best equipment, facilities, whatever.

I live in a town with two major hospitals. One gets a PET scanner. The one down the road rushes out to get their own PET scanner. One has been doing Flightcare helicopter transporting for decades. Suddenly the one down the street decides it, too, must have a helicopter. This is just a VERY COSTLY duplication of services which also drives the cost of health care through the roof.

Rant off.

[loyalsister]

10. If you think this is bad

you should check into MDA. Talk about a bunch of criminals!!
One thing I didn't see here was that there is a huge segment of the population getting tax breaks from their "pat on the back" donations. If you have an argument with a person who has money about healthcare, they might point out their contribution without mentioning their tax deduction. Don't let them get away with it.

[Sgent]

11. Medicare was one of the chief instigators

of the cash patients pay more.

Under criminal fraud statues -- which have been heavily enforced against both physicians and hospitals, you got 5 years in prison for every incident of charging a cash patient less than a medicare patient. This also applied to insurance companies.

For this reason, cash prices were set about 10-20% above (or more) of the highest known contracted rate. This was because insurance companies often raise rates without telling people, and if your price was lower than their "allowable", you left money on the table.

About a year ago (maybe 18 months), CMS and the DOJ issued guidelines on cash discounts and on reducing fees for the indigent. A LOT of hospitals and physicians are now implementing this as part of their regular practice, but it does take time. Most doctors at least always felt the the cash patients were getting screwed, but their hands were tied -- it wasn't worth going to jail over.

[loyalsister]

12. What does this have to do with my post

??

[Sgent]

13. See Post 9

I'm still kind of new, and haven't quite figured out this "thread within a thread".

[loyalsister]

14. Ok

We're touching on two entirely different things. What you're discussing has nothing to do with what I mentioned.
MDA is the Muscular Dystrophy Assoc. They pay big bucks to CEOs. What has Jerry Lewis done that he would be rich at this point in his life?
Propped kids up for pity in search of a cure. Never entertaining the notion that they might live and need to adapt. When someone found this offensive here's what he had to say....

http://www.impactcil.org/Readings/jerry.html

When self interest enters into non-profits, the results can be very ugly. Unfortunately, they U.S. has assumed that that is the way to make them run most successfully. So we get Phrama and other bioindustries with the incentive to partner up and exploit them after all of your friends and neighbors who want to save a couple of bucks on their taxes have kicked in. Some people with disabilities might begin to feel like they're being experimented on.

http://www.sfbg.com/SFLife/35/48/cult2.html

[davsand]

15. I recently reviewed an article due out soon on that issue.

I'm bound by agreement not to release the article or any of its parts prior to its publication this summer, but essentially there are some safe harbors for hospitals who want to discount. You will see some movement there in the next few months.

The AHA (American Hospital Assoc) requested clarification from Tommy Thompson about discounts for the uninsured back in Dec of 2003. In Feb of 2004 Tommy Thompson responded. His response was direct--in that--it says there is NOT a problem with providing discounts to uninjured or medically indigent patients. However, his response also left a lot of ambiguities that still need to be cleared up.

I know there are several hospitals who would LIKE to provide more assistance to low income folks, however, they need some guidance before they can proceed. I was horrified to see that collection practices were outlined in the prior HHS guidelines--and that is just the beginning of the crap our government has done to the American medical consumer.

I'll grant you, some of the practices were put there to limit fraud, but others were just plain hurtful to poor people.

I talked to one of the players the other day and his comment was we really just need to get the AHA, HHS, the hospital finance guys, and a few of the activists together in a room and get it all hashed out. I think he's got a good idea, but I'm not expecting it to happen until there is enough pressure brought to bear on the hospital industry and the government to make it worthwhile for them. Right now, it isn't.

Scruggs' lawsuits and local property tax challenges are ramping up the pressure. If Scruggs gets some traction in some of the state level class action suits you might see a different set of attitudes.

If consumers start kicking legislators in the backside maybe you'll see movement.

Maybe if the hospital bond and finance guys get worried enough you'll see some action.

However it comes to pass, I think the face of the health care industry is changing.


Laura

[Sgent]

18. Even before the AHA request

was the request by NACHC (Natl. Assn. of Community Health Centers) to the HHS OIG to clarify requirements and create a safe harbor for sliding fee patients. Circa 1998 or so.

The resulting letter from OIG was very damning, provided no safe harbor, and basically told everyone it was very questionable. The unwritten rule was that they *might* not violate various statues, but they refused to say when that would be the case. CHC's, in poor areas and with government grant funding, decided to go ahead on the premise that they won't mess with us.

Everyone else, was fearful, and locked into the technique of do everything by the book and make sure we are safe. Thompson's statements a few years ago is what has opened up the field. Many hospitals and private physicians now offer cash discounts, sliding fee's, and the like.

[davsand]

19. Do you remember specifics on this one?

We had a Seniors' program locally that was terminated by a hospital who claimed it was illegal based on much of what you are describing. At the time, the community group was able to demonstrate pretty clearly--they thought--that waiver of the Medicare shortfall was not a legally troublesome issue. Now, I'm starting to wonder about it...

Can you shoot me a PM with some info on this-PLEASE???

Thanks!


Laura