Catholic Health Initiatives, the second largest U.S. Roman Catholic health system in terms of staffed beds, began to roll out a program that charges uninsured patients unable to qualify for financial aid the same prices as managed-care companies.
CHI, which owns 68 hospitals in 19 states, will offer as of Jan. 1, 2006, its average managed-care discount to patients who have no insurance but do not qualify for charity care or state and federal safety-net plans. Four of its hospitals in St. Vincent Health System, Little Rock, Ark., already adopted the pricing policy as of Dec. 1.
The move by the Denver-based system comes amid mounting pressure from Congress, patient advocacy groups, unions and lawyers who contend not-for-profit hospitals unfairly gouge uninsured patients who typically pay the so-called sticker price because they lack the clout to negotiate discounts won by insurers.
Ascension Health, St. Louis, the largest Catholic U.S. system, already offers uninsured patients a similar discount. Ascension charges such patients the same rate as the lowest price negotiated by managed-care providers in the market, according to an Ascension spokesman.
Colleen Blye, CHI's chief financial officer, said the system extended the deeper discounts to uninsured patients who pay their own medical bills as part of an ongoing review of the Catholic system's charity-care and billing policies. Since 2003, CHI has revised and standardized its billing and collection practices and revamped its standards for how and when to approach and educate patients on payments, said Peter Savini, CHI's vice president for revenue cycle management.
Blye said she does not expect the discount to curb CHI's spending for patients who cannot or do not pay. CHI's bad debt and charity-care expenses climbed to 13.2% of the system's net patient revenue for fiscal 2005, which ended June 30, from 11.4% a year earlier, Blye said.
The system unveiled a plan internally in mid-October, giving hospitals a little more than two months to overhaul discounts.
In Minnesota, the Catholic system's five hospitals have adopted a slightly different discount policy for low-income patients in a voluntary agreement with the state's attorney general, Mike Hatch.