Illinois Attorney General Lisa Madigan threw her support behind alawsuit filed against Advocate Health Care over how it charges theuninsured.
She filed an amicus brief last week asking the Circuit Court ofCook County not to dismiss the complaint. The suit accuses Advocateof overcharging the uninsured and seeks to force Advocate to halt thepractice and stop pursuing collections against such patients.
People lacking insurance typically get charged higher prices forservices at hospitals here and across the country. While insurancecompanies and third-party payers such as Medicare and Medicaid usetheir clout to negotiate big discounts off the gross, or 'sticker,'price for such services, the uninsured lack such discounts and arecharged the sticker price. Hospitals have drawn criticism across thecountry because of the practice, and it has led to other lawsuits.
But Advocate and other hospitals have maintained that federalMedicare law governs how they bill the uninsured.
Madigan disputed that argument in her brief. She cited a letterfrom U.S. Health and Human Services Secretary Tommy G. Thompson,written to the American Hospital Association earlier this year, whichreferenced a letter from the Chicago-based association on the issue.
Thompson's letter said, 'Your letter suggests that HHS regulationsrequire hospitals to bill all patients using the same schedule ofcharges, and suggests that as a result, the uninsured are forced topay full price for their care. That suggestion is not correct, anddoes not accurately reflect my policy. ... Hospitals can providediscounts to uninsured and underinsured patients who cannot affordtheir hospital bills and to Medicare beneficiaries who cannot affordtheir Medicare cost-sharing obligations. Nothing in the Medicareprogram rules or regulations prohibit such discounts.'
The agency has maintained that this position represents no policychange, Madigan notes in the brief.
'Discriminatory pricing policies that make health care vastly moreexpensive for low-income uninsured residents of Illinois violates thestate's public policy of improving access to health care among lowincome residents,' Madigan said. '...The allegations raised inplaintiffs' complaint, if true, would violate Illinois publicpolicy.'
Advocate spokesman Edward C. Domansky maintained that federalrules still play a role in how the uninsured are billed.
'There are provisions that talk about proof of indigence andmaking applications for charity care,' he said. 'The federalregulations still basically serve as a starting point for allnegotiations, whether with the uninsured, the government or healthinsurers. The uniform charge structure is still the requirement.Discounts can be offered once proof of indigence is determined.'
He also contended that one of the key roadblocks to offeringdiscounts and charity care to the uninsured is lack of patientcooperation.
***
Data released by Assurant Health reveals strong interest in newhealth savings accounts.
The health insurance provider, which covers more than 1 millionpeople nationally, said that in the first five months since offeringHSAs, it has received more than 56,000 applications from interestedconsumers, and 43 percent of the people did not indicate any priorhealth insurance coverage, Assurant said.
Milwaukee-based Assurant shared the data at a briefing in Chicagolast month with the Illinois Chamber of Commerce, the Illinoischapter of the National Federation of Independent Business and U.S.House Speaker J. Dennis Hastert. He sponsored the HSA legislation.
The accounts debuted this year in the Medicare reform law. Theaccounts are funded with contributions from consumers and employers,and provide high-deductible health plans for individuals andfamilies. That includes plans with at least a $1,000 annualdeductible per individual or a $2,000 annual deductible per family.The advantages of the plans are that individuals or their employerscan fund the accounts with pre-tax dollars and accumulate nontaxableearnings. Unused funds can be rolled over every year, and the moneyused to pay for medical expenses, also tax-free.
Additionally, by putting much of the responsibility for buyinghealth care in the hands of HSA owners, the thinking is thatconsumers will be more likely to shop for lower-priced care.
***
Lake Forest-based TAP Pharmaceutical Products Inc. won approvalfrom U.S. regulators last week to market its Prevacid drug for use bychildren ages 12 to 17 for two conditions.
The U.S. Food and Drug Administration approved the drug for theage group for the short-term treatment of the symptoms ofgastroesophageal reflux disease, also known as acid reflux disease.It also approved the drug to treat erosive esophagitis, a conditionin which the lining of the esophagus has been damaged.
