Hospitals must immediately report to the Los Angeles County Department of Public Health whenever they try to collect medical debts from patients, according to regulations backed Tuesday by county supervisors.
The law, which requires a second vote to be adopted, requires the hospital to the district in a month or two to start the collection of debts, which may include a phone call or a letter to request payment more than 180 days after the initial bill, selling. debt to collection agencies, garnishing wages, seizing bank accounts or informing consumer reporting agencies.
The new rules also require hospitals to report up to four times a year on medical debt accrued in the past few months by patients and financial assistance provided. Failure to do so may result in fines and legal action.
Public health officials say the rules will help shed light on hospital practices and address an important question: Where are the missed opportunities for hospitals to provide financial assistance?
Hospitals are supposed to provide financial assistance to patients in need, but “the rub is implementation,” said Dr. Anish Mahajan, chief deputy director of the LA County Department of Public Health. In a survey by the national non-profit Dollar For, less than 30% of patients saddled with hospital bills were unable to say they applied and finally received financial assistance.
Many hospitals are trying to help, Mahajan said, but data shows “a lot of medical debt — and that debt is not carried by the poor.”
Los Angeles County officials estimate that medical debt will exceed $2.9 billion in the county by 2022, burdening 1 in 10 adults.
The public health department has launched an initiative to cancel medical debt, including the purchase and forgiveness of existing debt. In June, he set aside $5 million for a planned agreement with a debt relief nonprofit that county officials estimate could eliminate $500 million in debt for 150,000 residents.
But the district insists it also wants to prevent patients from incurring medical debt in the first place. Mahajan said that by collecting information under the new regulations, “then we can understand how hospitals …
For example, the county said it can match data on patients whose medical bills are sent to collections to see if they can get help, then reach out to hospitals about those findings.
“The goal is to help hospitals do better,” Mahajan said.
These numbers can also help identify if financial assistance is failing to reach certain groups of LA County residents, which can guide education and public education about the assistance.
For example, Mahajan suggests that in some cases, hospitals may have good policies regarding financial assistance, but some patients may be afraid to ask for such assistance because of concerns about their immigration status.
Addressing those concerns may involve not only hospitals but other county coalition members seeking to address medical debt, including legal aid and consumer groups, he said.
The mandatory report may also indicate to the health facility that financial assistance and debt collection practices are not the norm, compared to other hospitals in the region. Public health officials report that hospitals in LA County will provide more than $600 million in financial assistance by 2021, but more than half of that will come from just four facilities — which are managed by the county itself.
The safety net hospitals “can’t cover all the counties, and there’s a lot of financial aid,” said Dr. Naman Shah, division director of medical and dental affairs at LA County Public Health. “The reason for this rule is so that we can do better.”
Dr. Elaine Batchlor, chief executive officer of MLK Community Healthcare, told the county board that the Willowbrook hospital proactively takes steps to assess whether patients need help, uses software and other tools to check if they can afford copays, and then writes off loans if finances look shaky. .
Those financial tools are “widely available, and not difficult to use,” Batchlor said Tuesday.
LA County will also create a website where the public can read aggregate data on medical debt at local hospitals, although it is still determining what information will be posted, Mahajan said.
Hospital Assn. from Southern California said members are deeply concerned about medical debt as an issue, but the organization remains concerned about some aspects of the district’s requirements.
In response to hospital concerns, the county loosened some rules on how often reports must be provided, but “there are still concerns about how” the data requirements end, said Adena Tessler, the hospital association’s regional vice president for Los Angeles. Country.
For example, Tessler said that in some cases, hospitals may not be able to provide information because it has not been provided by the patient himself. Additionally, “the focus on hospitals remains a concern, as this is only a medical debt issue.”
Public Health Director Barbara Ferrer said Tuesday that hospitals are a reasonable place to focus initially because “hospital bills comprise the majority of debt and the largest bills.” Supervisor Janice Hahn added that “the work doesn’t stop here” and the county will explore how other entities — including insurance companies and private provider groups — can play a role.
“Hospitals are not the only cause of medical debt,” he said, “but starting there will help you plan.”
Stanford University economics professor Neale Mahoney applauded the effort, saying he hopes it will expand to other jurisdictions. “Medical debt is a dark corner of the US health care system,” he said, and it can be a “powerful disinfectant.”
LA County’s requirement applies only to a handful of hospitals in unincorporated areas — county officials estimate the number is seven, including MLK Community Hospital — but local cities can apply as well to cover their jurisdictions. Hospitals will have approximately six months after the LA County ordinance goes into effect before failing to submit a report becomes a violation.
Tessler, of the hospital association, said that since the rule will be rolled out first in unincorporated areas, his hope is that government officials will take the time to make sure the reporting requirements are appropriate before expanding the rule to other parts of LA. Country.
Ferrer said his department will reevaluate the burden of collecting the data within a year. Concerned about patient information, he said the portal that hospitals will use to provide information when trying to collect debts from individual patients complies with federal laws on protecting patient privacy.
Batchlor, in a statement Tuesday, described helping an uninsured friend who was diagnosed with cancer get the treatment she needed, only to find out recently that the woman is no longer insured because “now she can pay her medical bills or pay the premiums for her health insurance – she can’t do it.” both sides.
Hospital executives said that “the cause of medical debt is the high cost of health care and the failure of health insurance to cover these costs.”
To solve the problem, he said, “Ultimately we have to deal with the root cause.”
