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Preventing Hospital Debt Among the Uninsured

 

With debt collection for medical bills a lead cause of bankruptcy for families without health insurance, Families USA, in a new brief, highlight a range of policies states have enacted in recent years to protect the uninsured and underinsured. 

Part of the problem is that the uninsured are charged far higher prices for the same medical procedures than those with insurance, since insurance companies negotiate deep discounts in exchange for patient referrals.  Here are some key state policies that help make a difference:

California:  In 2006, California enacted AB 774, which requires hospitals to (1) charge uninsured patients no more than what they charge Medicaid and Medicare patients, (2) inform patients of their consumer rights and potential access to public coverage, and (3) require hospitals to give families 150 days to negotiate their payments before sending bills to collections agencies.

Colorado:  For patients with health insurance, Colorado in 2006 enacted a law requiring hospital patients who, as part of their care are unknowingly treated by "out-of-network" specialists who may not be in their health plan's network, be charged at no greater cost than if the services were provided by an in-network provider.

Connecticut: In 2003, Connecticut enacted a law that requires hospitals to notify patients about the availability of free and discounted care, caps the interest rates hospitals may charge on medical debt, and creates special legal protects for medical debt.

Illinois:  In July 2006, Illinois established new protections for the uninsured against unfair hospital billing and collection practices, including better notification of patients of their rights and restricting legal action against patients with insufficient income and assets.

New York: In 2006, New York enacted Section 2807-K Amendment to their Public Health Law to reduce hospital charges for the uninsured with a sliding scale of payments based on patient income, a prohibition on foreclosing on a patients home to collect a bill, and reports by hospitals on financial assistance provided to patients.

Other states have negotiated similar agreements with hospitals through legal actions as well. All of them highlight demands that hospitals act on their historic missions to treat the poor and uninsured decently-- and charge no more than what they charge those with insurance.

 

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