With hospitals continuing to claim bewilderment over how to implement discounts to patients who can't pay their bills, the Healthcare Financial Management Association said it's planning to establish a task force to help hospitals craft workable policies.
The task force, which would expand on recommendations issued by several state hospital associations and the American Hospital Association, could produce a report as soon as late summer, HFMA President and Chief Executive Officer Richard Clarke told Modern Healthcare last week.
Clarke said the task force, composed primarily of providers, may recommend federal regulatory changes.
Hospitals say uncertainty abounds on how to give price breaks to patients of limited means without violating federal law. That's despite HHS Secretary Tommy Thompson's declaration in a Feb. 19 letter to AHA President Richard Davidson that hospitals can legally give discounts (Feb. 23, p. 6). The declaration was accompanied by a question-and-answer summary of federal policies, which is posted on the CMS' Web site, cms.hhs.gov.
"There does seem to be confusion even within CMS as to what can or can't be done," Clarke said. "Most hospitals are putting to-gether policies or have policies in place that probably won't be changed much by this letter."
For example, hospitals wonder how they can offer help without violating rules against using incentives to generate Medicare business.
Further, the CMS appears to have changed its interpretations of the law, Clarke said. For example, the guidelines released last month state that hospitals do not need permission to offer discounts. That's a reversal of a CMS directive last year to hospital chains Tenet Healthcare Corp. and HCA, which were instructed to obtain permission from fiscal intermediaries before implementing discounts.
Hospital leaders said last week that the public finger pointing by the AHA and HHS over regulations overlooks a key problem: A significant number of patients are unwilling or unable to provide financial information such as tax forms that are required to qualify them for discounted care. Some of these could be undocumented immigrants who might fear reprisals even though they are allowed treatment.
Advocate Health Care implemented a program to educate patients about financial assistance last year and also increased the income ceiling to qualify for assistance to four times the federal poverty level from two times. But not all patients who could qualify for assistance appear to be receiving it, said officials of the 10-hospital system based in Oak Brook, Ill.
"Patient cooperation is essential to determining financial need," said Marty Manning, Advocate's vice president of operations finance. "We encourage patients to help us to help them by following through with the documentation necessary for us to assess their financial need."
The task force, which could be established as early as this month, would constitute the fourth phase of the HFMA's Patient Friendly Billing Project, which was launched in 2000 to correct what Davidson said at the time was the industry's "No. 1 public relations problem"-confusing bills.
The project has explored ways to make bills easier to understand. Clarke said the HFMA was taken off guard by recent negative publicity about hospitals that charged full prices to patients who couldn't pay and pursued aggressive collection tactics.
Experts said discounts wouldn't impact hospitals fiscally because most charges to the uninsured are written off as bad debt or charity care.
"There is a lot of noise that the uninsured are charged the most, but at the end of the day they don't pay (full charges) anyway. Nothing much changes (with the new guidance)," Clarke said.