Healthcare Business News
Neil McLaughlin
Managing Editor
Neil McLaughlin Managing Editor

Big bills, big problems

Prevention and cost-cutting would be helpful prescriptions

By Neil McLaughlin
Posted: May 19, 2012 - 12:01 am ET

Notes on the news:

The Accretive Health saga took another turn last week as the billing and collection company said it would launch and fund a panel to set patient collection standards.

Accretive has taken a dip in hot water over allegations that it used abusive tactics in trying to collect money from patients—some as they arrived at the hospital or the emergency room (See story from April 30, 2012: "Pushing the limit"). The Minnesota attorney general's office issued an uncomplimentary report about the company's practices. That investigation stemmed from collection efforts at Fairview Health Services, the Minneapolis-based system that was one of Accretive's high-profile clients. Fairview ended its contract with Accretive about a month ago.

Since then, U.S. lawmakers have taken an interest, making a sweeping request for documents on the company's policies and practices (See story from May 7, 2012 "Fire spreads"). Rep. Pete Stark (D-Calif.) has asked HHS and the CMS to investigate Accretive. And the Illinois attorney general has said she will initiate a probe.

Accretive has vigorously denied any wrongdoing, saying allegations of misconduct are unfounded. It also denies that it violated federal privacy and credit laws.

Now, the Chicago-based company says it has appointed a blue-ribbon panel to select a not-for-profit, independent standard development organization to bring together healthcare organizations, patient advocates, trade groups and others to create “voluntary consensus standards.” Those standards will be sent to a national accreditation group, Accretive said.

Former HHS Secretary Mike Leavitt will chair the panel, which includes former CMS administrators Dr. Mark McClellan and Donna Shalala as well as former Sens. Tom Daschle and Bill Frist.

This effort is commendable, but you have to wonder if a lot of grief might have been avoided by doing this on the front end. Given the sensitive nature of patient collections, shouldn't the company have adopted and communicated standards to its employees at the outset?

And there are already some guidelines for the industry. The American Hospital Association has hospital billing and collection guidelines, which were recently updated.

Prevention is good in healthcare business as well as medicine.

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Speaking of bills, two interesting studies were released this month on costs.

Benefits consultant Milliman reported that the average healthcare bill for a family of four year has increased 6.9% from 2011 to $20,728 this year. The company said that was the lowest annual increase in the 12 years of its survey. But the dollar boost was the largest so far—$1,335.

So the results of a new Commonwealth Fund report examining healthcare spending, supply, utilization and quality are no surprise. The U.S. spends far more on healthcare than any other country. Why? It's not because Americans go to the hospital or the doctor more than people in other countries—they don't. The U.S. has fewer physicians per person than in all the study countries except Japan. But our hospital stays were far more expensive than those in other countries—totaling more than $18,000 per discharge. In Sweden, Australia, New Zealand, France and Germany, the cost is less than $10,000.

“It is more likely that the higher spending is largely due to higher prices and perhaps because of more readily accessible technology and greater rates of obesity,” author David Squires wrote. “Despite being more expensive, the quality of healthcare in the U.S. does not appear to be notably superior to other industrialized countries.”

After the battering so many patients have taken in the Great Recession, whoever is collecting the supersized bills faces a big challenge.

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