State Says Catholic Hospital Overcharged Poor Patients

TACOMA, Wash. (CN) — Washington state has sued a Catholic hospital system on charges it demanded up-front payment from poor patients and failed to disclose information about discounted services, while bringing in $674 million in operating revenue.

Attorney General Robert Ferguson asked Pierce County Superior Court to fine and enjoin the Franciscan Health System dba St. Joseph Medical Center, for violating state law. Co-defendant CHI Franciscan operates eight hospitals and numerous clinics in Washington state and is a subsidiary of the nation’s third largest nonprofit health system, Catholic Health Initiatives.

According to Wednesday lawsuit, the hospital’s on-site billing agency, Conifer Health Solutions, demanded up-front payment from all patients and failed to screen patients for free or reduced cost services under the state’s Charity Care Act.

That law requires healthcare providers to notify patients of their right to charity care and to screen patients for eligibility before attempting to collect payment.

However, Conifer Health representatives were told to use particular phrasing when dealing with patients, including asking for payment up to three times, in order to suggest the only option was to pay up front, according to the state’s complaint.

In addition, Conifer trained its workers not to give charity care information to a patient without attempting to collect a deposit first. When a patient did submit a charity care application, Conifer required numerous financial documents instead of one source of documentation, as required by state law. Because patients failed to meet the excessive documentation requirements, 50 percent of applications were denied, according to the complaint.

“These acts and practices deceived low-income patients regarding their responsibility for medical expenses, misled patients about their payment and financial assistance options, and unfairly prevented them from accessing charity care,” according to the state’s complaint.

“Without information about and access to charity care, St. Joseph’s low-income patients paid for medical expenses and incurred medical debt that St. Joseph should have provided as charity care.”

The state seeks declaratory judgment that the defendants violated consumer law and engaged in unfair or deceptive trade, an injunction, fines of $2,000 for each violation, and costs of suit.

The Washington Attorney General’s Office said they learned of the Charity Care law violations from complaints from the public.

CHI Franciscan did not respond to a request for comment.

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