One of the nation’s largest nonprofit hospital chains, Providence, will reimburse payments made by more than 700 low-income patients who were wrongly billed for medical care that should have been free.
Patients were eligible for Medicaid, government health insurance for low-income people, but were still billed for health care and then referred to debt collection companies. This practice was the result of a program, known as Rev-Up, designed to maximize revenue by squeezing as much money as possible out of patients – even those whose incomes were so low they would never have had to be charged at all.
Rev-Up, which Providence created with help from consulting firm McKinsey & Company, was investigated by The New York Times last month.
Providence began reaching out to patients in late September, weeks after The Times asked the hospital system for comment on its billing and debt collection practices, according to Providence spokeswoman Melissa Tizon. She said the hospital system, which does not disclose the total amount of money it reimburses, had been planning to issue the refunds for months.
In February, Bob Ferguson, the Washington state attorney general, sued Providence, accusing it of breaking state law in part by deploying debt collectors to pursue more than 55,000 patient accounts. . Providence fights against the trial.
Under law in Washington state, where Providence is based, hospitals must provide free care to patients whose income is below 300% of the federal poverty level, or about $83,250 in annual income for a family of four. The group generally includes anyone eligible for Medicaid, and until 2019 Providence waived all medical costs for those covered by the program.
That year, Providence — which operates 51 hospitals and more than 900 clinics across the country — changed its practices and began sending Medicaid patients to collection agents, The Times reported last month.
Ms Tizon blamed an “unintentional error” that occurred when Providence updated how it identified those eligible for charity care, “causing some Medicaid patients to receive collection notices”.
Ms. Tizon said Providence was serving about 760 patients who were eligible for Medicaid but were incorrectly billed. She said the hospital system would reimburse their fees and interest and work with credit reporting agencies to “reverse any negative credit impact.”
Last week, Gregory Hoffman, chief financial officer of Providence, messaged employees about the Times investigation.
“Reading the story, I didn’t recognize the organization that was being described because it’s not the organization we serve. I’m sorry you had to read it,” he wrote. He added that Providence would contact “each of the patients featured in the article to talk with them about their experience and to make sure they have the financial help they need.”
Providence also purchased full-page advertisements in The Oregonian and The Seattle Times newspapers that promoted its charitable care practices. The ads ran the same day the Times published its investigation.
The article prompted calls for action from state and federal lawmakers. Dr. Lisa Reynolds, an Oregon state representative, said her state’s attorney general should look into Providence’s collection practices there.
Senator Patty Murray, the Washington Democrat who chairs the Senate Health Committee, sent a letter to Providence Chief Executive Dr. Rod Hochman expressing concern about the Times’ findings and asking about data collection practices. Providence.
Ms Tizon said on Tuesday that Providence was preparing a response to Ms Murray’s letter. She said the hospital system offered to meet with the senator in February, after the state’s lawsuit was made public, but Ms Murray has not responded. “She did, however, repeatedly contact Providence leaders asking for campaign contributions,” Ms. Tizon said.
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