Providence hospitals sued by WA AG over ‘collection tactics’, allegedly failing to provide charity care

According to a trial filed Thursday by State Attorney General Bob Ferguson.

According to the complaint, Providence has not developed an “adequate” system to identify or protect patients eligible for charity care, which is free or reduced-cost medical care that hospitals are legally required to provide to those who cannot. pay the full amount.

The complaint names eight Providence sites (in Everett, Olympia, Centralia, Chewelah, Colville, Walla Walla and two in Spokane), five Swedish Health Services hospitals (three in Seattle, one in Issaquah and one in Edmonds) and Kadlec Regional Medical Center in Richland.

Both Swedish and Kadlec are affiliated with Providence.

“Charitable care helps low-income families avoid crushing medical debt by making financial assistance available to those who qualify,” Ferguson said in a Thursday. declaration. “Hospitals cannot mislead Washingtonians about their legal right to access medical financial assistance. They must obey the law and ensure low-income patients have access to the resources they need.

In a statement Thursday, the hospital system denied the allegations.

“The Providence Family of Organizations is extremely disappointed that the Washington State Attorney General’s Office has chosen to bring inaccurate and unjust charges against us regarding our charitable care and financial assistance practices,” the statement read.

The statement said the hospital system provided $79 million in free and discounted care in 2020 and that Providence’s policies are consistent with the requirements of the state’s charitable care law.

“If we find that we have not met the high standards we hold ourselves to, we are making immediate changes,” the statement said. “…While we strongly disagree with the allegations in this complaint, we will continue to support policies that expand access to charitable care and make health care more accessible to vulnerable patients.”

from washington charitable care law was established in 1989.

Those with household incomes at or below 200% of the federal poverty level are eligible for charity care, including more than 1.8 million Washingtonians, according to Ferguson’s statement. Coverages apply to both insured and uninsured patients.

Washington law also requires hospitals to notify patients of charitable care verbally and in writing, and screen them for eligibility before attempting to collect payments.

The hospital system added that it supports the legislation, House Bill 1616, to increase access to affordable health care. The bill was approved in the House earlier this month and is currently being considered by the Senate.

The complaint alleges Providence employees have been trained since 2018 to use “collection tactics” that make it appear that all patients must pay for care, regardless of income level, according to the complaint.

One tactic gives staff members a script to follow and asks them to “ask every patient every time” to pay their hospital bills, the complaint says, referencing Providence’s training materials. Another training tells staff members, ‘Don’t take the first no’, which means staff should keep asking patients how they want to pay for their treatment even after patients say they can’t pay. the bill.

The training asks staff to try at least three times to collect payment after the ‘first no’ – and only give information about charity care after that.

“These aggressive collection measures capitalize on the power and knowledge imbalance between Providence and its patients,” the lawsuit states. “Providence is fully aware of the availability of charitable care. However, many low-income patients in Providence are not.

Ferguson also alleges Providence sent more than 54,000 patient accounts to a third-party debt collection agency, even though the hospital knew the patients were eligible for financial assistance. Sending accounts to a debt collector likely could have hurt patients’ credit, according to the lawsuit.

The accounts totaled more than $70 million.

Complaint seeks full write-off of medical debts and refunds for patients who paid for care while eligible for financial assistance, plus millions of dollars in civil penalties for alleged Privacy Act violations of the consumer.

The total number of violations has not been determined.

Ferguson, who launched the Providence investigation after receiving complaints about Sweden’s charitable care practices, has filed at least two other major lawsuits related to financial assistance for medical needs, according to a statement from his office. .

One was filed in 2017 against St. Joseph’s Tacoma Medical Center and its CHI Franciscan Health System (now known as Virginia Mason Franciscan Health), and resulted in the hospital system paying $41 million. in debt relief and $1.8 million in repayments.

Ferguson also sued Capital Medical Center in Olympia in 2017 on similar charitable care charges. Capital eventually paid nearly $400,000 in repayments and debt relief.

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