High costs across the health care system are hurting Americans – from increasing insurance premiums to rising out-of-pocket costs. In fact, health care continues to rank highest on a list of perennial concerns over retirement, housing, higher education and child care, regardless of party affiliation.
Nowhere is this truer than with hospital care, which is the single largest component of national health care spending. While patients in Utah and across the country are struggling to afford the care they need, more and more hospitals are pursuing predatory practices to recoup medical bills, all while increased consolidation is raising prices without improving care.
At the January 2020 J.P. Morgan Healthcare Conference, Intermountain Healthcare CEO Marc Harrison even admitted that hospital care is the number one cause of personal bankruptcy in the U.S. That’s no surprise in Utah, where residents are burdened with more than $10 billion in medical debt at any time. Then, Intermountain CFO Bert Zimmerli went on to brag about the system’s 6% operating margin and its “really strong” collections from patients, a deeply troubling practice that is gaining steam across the country.
In Utah and across the country, hospitals and providers are pursuing predatory actions like lawsuits against patients who have unpaid bills. The IRS requires hospitals to have policies to determine whether a patient qualifies for financial assistance before initiating collection attempts. However, the reality is that lawsuits, wage garnishments and other heavy-handed collection efforts have become the norm at far too many hospitals, rather than last resorts. In one heartbreaking story, a Utah man committed suicide after being arrested over an unpaid medical bill.
Several hospitals are taking these actions without first informing patients about community benefits or charity care that they may qualify for that could alleviate the financial burden of outstanding medical bills. Many hospitals receive funding from multiple federal support programs intended to help cover low-income or uninsured patients’ costs, yet they continue to pursue these aggressive actions against patients who might qualify.
It is deeply troubling that these practices occur at all, but even more so given that, in addition to escalating enforcement actions against patients, from 2007 to 2014, hospitals increased prices by 42% for inpatient care and 25% for outpatient care. In 2017, hospitals were paid 2.4 times Medicare rates while treating patients with private insurance, according to a Rand study.
Even though hospitals are required to post their price lists, or chargemasters, publicly, there are no regulations requiring them to actually charge those prices, meaning patients could walk away with much larger bills than advertised. This is of particular concern in Utah, where surprise bills are a bigger problem than they are in other states.
While hospitals are raising prices, receiving funding from the government and aggressively pursuing patients for unpaid bills, they continue to consolidate, which in turn raises prices even further. These consolidations also threaten independent rural hospitals and the communities where they exist, exacerbating the already widening health care gap between rural and urban areas. With new research showing that hospital mergers don’t improve the quality of care, it’s clear consolidation places profits ahead of patients, and hospital executives have shown no interest in slowing down.
Hospitals play an essential role in our health care system, and people depend on them in emergency situations and when seeking serious care. Hospitals should be there when patients need them, but these rising costs, lack of transparency and predatory practices put critical health care out of reach for many consumers.
As patient advocates fighting to give consumers a voice in the health care debate, Consumers for Quality Care is deeply disturbed by the predatory practices that have become so engrained in our health care system. More must be done to ensure patients are protected against hospital practices that leave them financially vulnerable – it’s time for hospitals to stop maximizing profits on the backs of consumers.
Donna M. Christensen
Donna M. Christensen is a member of the Consumers for Quality Care board. She retired from the U.S. House of Representatives in 2015, where she served nine terms. She is the first female physician to serve as a member in the history of the U.S. Congress.
