Allina Health, a large nonprofit health system based in Minnesota, announced Wednesday that it will end its policy of denying Medicare patients with outstanding bills of $4,500 or more.
Although Alina Hospitals has treated anyone in emergency rooms, other services have been cut off for heavily indebted patients, including children and those with chronic conditions such as diabetes and depression, The New York Times reported in June. Patients were not allowed to return until their debts were paid in full.
Allina issued its policy change less than a week after Keith Ellison, the Minnesota attorney general, announced that his office was investigating Allina’s practice of withholding care from patients in debt. The investigation is part of a broader look at how the state’s hospitals, all of which are nonprofits, bill patients for Medicare.
“There is a growing consensus that there is very little difference between a for-profit and non-profit hospital when it comes to behaviour,” Mr. Ellison said in an interview.
Nonprofit hospitals like Alina get massive tax breaks for providing care to the poorest and most vulnerable people in their communities. But a Times investigation last year found that over the past several decades, many nonprofits have largely abandoned their charitable missions, with devastating consequences for patients.
Allina Health has 13 hospitals and more than 90 clinics in Minnesota and Wisconsin. Its nonprofit status enabled Allina to avoid nearly $266 million in state, local and federal taxes in 2020, according to the Lown Institute, a think tank that studies health care.
In exchange for those lucrative tax breaks, the IRS requires Allina and its peer nonprofit organizations to provide services to their communities, in part by providing free or low-cost care to low-income patients.
But federal rules are silent about how poor patients are to qualify for free care. And in 2020, Alina spent less than half of 1% of its spending on charitable care, well below the nationwide average of about 2% for nonprofit hospitals, according to one report. analysis Hospital financial profiles by J.P., a professor at the Johns Hopkins Bloomberg School of Public Health.
“The industry needs to tell people that they may be eligible for charitable care,” said Mr Ellison. “It seems people aren’t told that at all.”
at least 100 million Americans Struggle with medical debt. Their bills account for about half of all outstanding consumer debt in the country.
Hospitals have increasingly used a range of aggressive methods to collect debts from patients. Some flood local courts with lawsuits to extract payments from patients. Others garnish patients’ wages or Grab their tax refunds.
But Alina Politics took things a step further.
The 12-page document instructed health system employees on how to cancel appointments for patients with debts totaling $4,500 or more. The policy has instructed providers on how to lock patients’ electronic health records so that staff cannot schedule future appointments.
Some of the expelled patients had incomes low enough to qualify for Medicaid, the federal government’s insurance program for the poor.
Alina’s employees said the policy forced them to ration care, even for children.
The health system initially defended the policy when contacted by The Times in May, noting that it only cut patients off after contacting them by phone and sending repeated messages with information about applying for financial aid.
But Connie Bergerson, a spokeswoman for Alina, said in a statement this week that the health system revisited the policy this summer, and determined there were “opportunities to engage our clinical and technology teams differently to provide financial assistance resources to patients.” Who needs this support?”
Alina’s doctors continue to push for additional changes. Earlier this month, primary care physicians started the system attempt to form a union. If successful, it would be the largest doctors’ union in the country. Some physicians are pushing for legislative changes that would restrict or prohibit the practice of withholding care from patients with outstanding bills.
“The state of Minnesota should prohibit denial of Medicare to children based on medical debt,” said Jennifer Mehmel, a pediatrician who recently retired from her position at Alina Hospital. “Obviously, children are the innocent victims in this, but they bear the cost of the problem.”