A front-page article in the Wall Street Journal yesterday highlights the common practice among US hospitals of requiring up-front payments from uninsured or under-insured patients before they’ll provide treatment.
The story describes the plight of Lisa Kelly, a Lousiana woman diagnosed with leukemia and referred to cancer hospital M.D. Anderson for care. Though insured under a limited-benefit plan sold by AARP and underwritten by UnitedHealth, she wasn’t able to get treatment at Anderson unless she agreed to pay big sums of money ($45,000, $60,000) beforehand.
The practice isn’t new, nor is it limited to M.D. Anderson. (For-profit operators HCA and Tenet follow the practice, as do not-for-profits and state-supported providers.) Hospitals have for years been plagued by bad debt, or the unpaid medical bills left by uninsured or underinsured patients. And they have found a number of ways to deal with the problem — policies that have led in part to a financial rebound in the industry. Among those new methods are better case-management practices that identify patients who can be enrolled in Medicaid. Requiring prepayment is another tactic, since it’s much harder to collect on bills after a patient has left the hospital or finished treatment.
Prepayment requirements are reserved for people who theoretically can pay, since care for indigent patients can be written off as charity care. And though Mrs. Kelly was insured, she had an insurance policy that wasn’t up to the kind of catastrophic costs she was facing.
Called a limited-benefit or mini-medical plan, her policy was likely good for covering doctors’ visits and minor costs, but probably had a relatively low annual cap and may have excluded certain services altogether. Such plans are popular for individuals not covered by their employers and businesses who employ lots of part-timers, but they’ve also become increasingly common offerings for the full-time employees of smaller businesses. Unfortunately, individuals purchasing the policies don’t always understand that they’re not good for handling major medical emergencies. And some peddlers of the products, including a Texas company called HealthMarkets, have come under fire for not adequately explaining the risks to their customers.
At any rate, Anderson wouldn’t accept Mrs. Kelly’s plan; as a de facto uninsured patient responsible for paying her own medical bills, she was forced to make payments up front. And though the practice may be common, the Journal article still manages to shock because of the personal story attached to it, which throws into stark relief the indignities such practices force on patients already under great strain from dealing with critical illness. (In one reported episode, for example, the hospital sent a bill collector into Kelly’s exam room to discuss payment before proceeding.)
Like almost everything related to the American health care system, this one’s a thorny issue. Hospitals provide services and, of course, ought to be compensated. But surely, surely we can do better than this.
Oh, you mean the *University of Texas* M.D. Anderson center? Part of the University of Texas system? Go ‘Horns. You might think they’d take her in just to give some young doctor a bit of education.
By the way, as long as we’ve decided scarce economic resources shouldn’t have to be paid for, can I get a free Hoover’s subscription?
Kristi,
Why do an article on the illegal alien Mexican lady in Southern California who has had not 1, not 2, going for her 5th liver transplants at cost of 45,000 per, courtesy of the U.S. taxpayers? This would make better press. This was reported on the Jerry Doyle show.
Thank you,
Joe
Kristi,
My facts were incorrect in my first email. The gal I was referring to has had 4 liver transplants at the average cost for a liver transplant and first-year follow-up is nearly $490,000, and anti-rejection medications can run more than $30,000 annually, according to the United Network for Organ Sharing, which oversees transplantation nationwide. U.S. taxpayers still paid for her liver transplants.
Joe
Hospitals and physicians are always blasted for wanting to get paid for services. This is not an unusual practice for pay for service businesses such as lawyers. How many people get to move into a new house without paying for it first? If people would be willing to be educated to find out what they are buying, and willing to pay for the insurance that they need, there wouldn’t be a healthcare crisis today. Instead, healthcare is considered an entitlement by some, that they shouldn’t have to pay for. People would rather spend $100s of dollars for entertainment (movies, cable, theater, concerts, sports) or for their double white chocolate mocha frappacino every month than pay anything toward their own healthcare.
USA is the good samaritain to many people from many countries EXCEPT their own!!! I am all for helping people out and I do understand people in 3rd world countries are limited, in fact possibly have no healthcare at all.
Our Healthcare system is an absolute mess. A number of things are attributed to this. We had doctor’s and lawyers who scammed the system creating rising costs. Yes Insurance companies in past had fat bank accounts because most people didn’t use the insurance, therefore excesss funds were there and it covered costs….but it didn’t mean we neede to rip them off. But with scams and treating 3rd world countries cost are our of control.
But our biggest problem…is our insuracne companies are staffed with lay people who are not health experts that are sitting in thier cubicle making decisions about peoples health that they have no idea about. In fact I heard from someone in healthcare, that claims adjusters get INCENTIVES to refuse treatments or refusing paying for the treatment. THIS IS A CRYING SHAME AND WE NEED TO DO SOEMTHING ABOUT IT!!!!!
excellent writing .
excellent writing .