Women & Infants Hospital is among the fortunate ones. Because RIte Care, the state Medicaid program, covers pregnant women and children up to 250 percent of the federal poverty line, a much smaller share of patients are uninsured than at other hospitals.
If they have no coverage when they arrive, Women & Infants’ family resource counselors help them get on RIte Care if they are eligible. Or if that’s not an option, patients can apply for charity care – free or reduced-cost care for people up to 300 percent of the poverty line.
In 2007, a new R.I. Department of Health report shows, Women & Infants provided $2.48 million worth of charity care. But that’s not all the hospital gave away: It also wrote off $3.09 million in bills that patients never paid, including copays and deductibles.
For Women & Infants, it amounted to $1.55 per $100 in patient revenue, up from $1.49 in 2006 and $1.17 in 2005. And that was before anyone talked about a recession.
The state’s 13 private hospitals provided $49.7 million in charity case in 2007, at a net cost to them of $36.5 million, up 38 percent from a net cost of $26.4 million in 2006, according to the report.
Bad debt grew, though less dramatically, to $37.3 million from $33.1 million the previous year, or 8 percent. And combined, bad debt and charity care cost hospitals 2.84 percent of their patient revenue for the year, up from 2.4 percent in 2006.
“The re-port confirms the significance of increasing uncompensated care in Rhode Island, exacerbated by growing unemployment and uninsured rates,” said Edward J. Quinlan, president of the Hospital Association of Rhode Island.
“With hospitals experiencing declining operating margins, rising uncompensated care puts additional pressure on fragile organizations,” he added. “This is one of many outside influences negatively affecting our hospitals, which play a vital role in the state’s health care delivery system and economy.”
Hospitals classify the care they provide without pay in two categories: Charity care is charges for services that are delivered but never recognized as revenue, because they’re given out for free from the outset, while bad debt are charges billed for services rendered, but never collected and written off.
Hospitals’ charity-care guidelines have varied, but since April 2007, all the state’s hospitals have provided free care to uninsured patients with incomes below 200 percent of the federal poverty level (with an optional test that looks at the patient’s assets), and a sliding fee scale for patients between 200 and 300 percent of the poverty line.
Charity care is only given to the uninsured – but in 2007, that was an estimated 113,000 Rhode Islanders. Bad debt, on the other hand, can involve completely unpaid bills, or unpaid copayments and deductibles for insured patients. The latter, both Quinlan and Paul said, has been a growing problem for hospitals as employers have raised employee cost-sharing to offset insurance-premium hikes. But recent changes to RIte Care are also making an impact, leaving many low-income patients without coverage.
And when falling off RIte Care means losing access to prenatal care, for example, Paul said, it not only makes an impact on mothers’ and babies’ health, but it also increases the risk of costly complications.
And South County Hospital, which serves a suburban and rural population, had a charity-care burden of 0.83 percent, less than a third of Rhode Island Hospital’s 2.7 percent.
But not only the very poor sought charity care: 37 percent of beneficiaries were between 200 and 300 percent of the federal poverty level, paying reduced fees rather than nothing.
And bad debt has been hitting some hospitals hard, especially South County, which had to write off bills worth 3.92 percent of patient revenue, up from 2.29 percent in 2006 and 1.46 percent a year earlier. Rhode Island Hospital, meanwhile, had a 1.66 percent bad debt in 2007.
Linda Shelton, spokeswoman for Rhode Island Hospital’s corporate parent, Lifespan, noted that Lifespan’s hospitals have a “liberal charity-care policy” that results in a much higher ratio of charity care to bad debt than other institutions’ – 70 to 30 percent.
Still, she said, Lifespan partner hospitals provide nearly 58 percent of the state’s uncompensated care, even though they account for only 41 percent of patient discharges. And she warned that with the economy worsening, “we expect that uncompensated care, in the form of both charity care and bad debt, will continue to increase.” •
The report is available at www.health.ri.gov/publications/
UncompensatedHospitalCare.pdf.
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