June 22, 2004 – Last week lawyers filed several civil lawsuits against more than a dozen nonprofit hospitals, arguing that the hospitals violated their charitable obligations by overcharging uninsured patients and then aggressively trying to collect money.
According to the suits, uninsured patients are usually charged the most for their hospital visits. While insurance companies have negotiated huge discounts, the uninsured have to pay full price. A complaint filed against Provena Health, a Chicago-area hospital, alleges that uninsured patients are charged two to three times the rate collected from insurance companies.
The suits also attack hospitals' aggressive collection practices. A suit filed against Advocate Health Care Network in Oakbrook, Illinois alleges that one uninsured patient â€œreceived numerous threatening and harassing phone callsâ€� asking for over $48 thousand for her teenage sonâ€™s emergency room visit, the New York Times reported. Her son was treated for multiple gunshot wounds in 1998.
The suits came after months of controversy over hospitalsâ€™ billing practices. A recent Wall Street Journal article described patients who were still in their hospital beds being approached by bill collectors asking them to pay a portion of their bill. The Minneapolis Star Tribune reported that some patients with past due medical bills were arrested or had to forfeit their homes.
Around 44 million Americans are uninsured according to the Census Bureau. Three in ten emergency room patients lack coverage, according to the American College of Emergency Physicians.
The lawyers for the plaintiffs are asking for the creation of a hospital-finance trust to provide affordable care for the uninsured and for unspecified monetary damages for the plaintiffs, the New York Times reported.
Many of the hospitals argue that though they are classified as nonprofits, they are not responsible for providing free care for the uninsured, and that mounting costs require that they collect money from some patients without coverage, the New York Times reported.
The Star Tribune quoted American Hospital Association spokeswoman Alicia Mitchell, who defended the hospitals' practices. She called the suit â€œbaseless and misdirected, diverting focus away from the real issue of how we as a nation are going to extend health coverage to all Americans.â€�
Robert Hopper, an attorney who filed two of the suits, said the billing practices target those who can least afford medical care. â€œIt is hard enough for people who do have insurance,â€� he told the Star Tribune . â€œBut when you have no insurance and you have no means and you are trying to deal with it and meet your health care needs, then it becomes extremely burdensome.â€�