The medical system in the United States is incredibly complicated, and some people are very surprised when they receive a bill from a doctor or hospital system. Now, it appears that one of the largest nonprofit hospital systems in the United States, Providence, is going to issue refunds to more than 700 patients who were wrongly charged for medical care.
These individuals are originally qualified for Medicaid. This is a government health insurance program that is designed to provide insurance for individuals and families with low incomes. Unfortunately, the hospital system ignored this fact and billed these patients for their medical care. Then, when they did not pay, they referred the debt to a collection firm. It seems that the goal of this practice was to generate as much money as possible from patients. This includes individuals whose incomes were so low that they should not have received a bill at all.
The program responsible for this practice, called Rev-Up, was created by McKinsey. It has already been the subject of detailed investigations, as it appears to be a questionable program.
The hospital system has not disclosed the total amount of money that it is refunding, but it did say that refunds have been in the works for several months. Already, an attorney general for the state of Washington has filed a lawsuit against the hospital system, accusing it of violating state laws by inappropriately billing patient accounts. Even though Providence is fighting a lawsuit, it will be interesting to see how it plays out.
According to state laws in Washington, which is where Providence is located, hospital systems are required to provide free care to patients if their income falls below 300 percent of the federal poverty level. This is approximately $83,250 for families of four people. This also encompasses people who generally qualify for Medicaid, which means they should not have been billed for their medical care.
In total, Providence operates more than 51 hospitals and 900 clinics throughout the United States. A spokesperson for the hospital system indicated that they recently changed their practices, which led to an unintended error. Regardless, it appears the hospital system should be responsible for this mistake, and it could be facing fines and sanctions even as they refund patients.