Adventist Facilities Accused of Price-Gouging, Denying Care

[Fran]

http://www.washingtonpost.com/wp-dyn/content/article/2005/08/21/AR2005082101010.html?sub=new

Forcing a Look at Hospitals' Mission

Adventist Facilities Accused of Price-Gouging, Denying Care to Uninsured Patients

By Ceci Connolly

Washington Post Staff Writer

Monday, August 22, 2005; Page A03

ST. LOUIS -- Under a blistering sun here recently, armed with only bottled water, homemade signs and the plight of one deathly ill little boy, a dozen Latino immigrants came to shame leaders of the Seventh-day Adventist Church.

Their grievance: Hospitals operating in the name of the church overcharging and denying care to those least able to pay.

Rodney Vega, who has a brain tumor, was denied treatment at a Florida hospital because his parents could not pay.

$20,000, Forbes says. (Photos By James A. Finley -- Associated Press)

In the past year, lawyers for the poor have filed federal lawsuits in 22 states accusing nonprofit hospitals of failing to meet their tax-exempt obligations to provide indigent care. With those legal maneuvers unfolding at a glacial pace, one unlikely crusader is racing forward with a new line of attack, focusing on what he calls the un-Christian behavior of religiously affiliated hospitals.

"It's offensive these hospitals market themselves as providing the healing mission of Christ," said K.B. Forbes, the lead agitator and executive director of Consejo de Latinos Unidos, or Council of United Latinos. "There is nothing healing about charging someone quadruple and then sending the bill collectors after them."

Better known in Washington for his earlier work on Republican presidential campaigns, Forbes is applying pressure the old-fashioned way, with protests, news releases that scream indignation and always a sympathetic victim.

To add drama to the event, Forbes flew into St. Louis a petite 7-year-old Florida boy named Rodney Vega. He had just undergone his fifth surgery to remove brain tumors.

Rodney's parents are practicing Adventists; his father, a Venezuelan, is here on a special visa granted to religious ministers. Yet each time the family sought care at Florida Hospital, one of 38 owned by Adventist Health System, they say the hospital demanded money up front -- tens of thousands of dollars the family does not have.

"The real mission of the church is to help people like Christ did," said Rodney's mother, Judith Montilla Vega. "I don't like Florida Hospital saying they are Adventists. I don't want this hospital to use their name to do all these things."

Florida Hospital officials blame the Vegas' plight on miscommunication and misunderstanding. They emphasized that the Orlando-based hospital provides millions of dollars in charity care.

Orville Parchment, assistant to the president of the Seventh-day Adventist Church, said the church would step in if there was evidence the hospital operated counter to its principles. But he said he has not had time to "dig deeply" into the charges.

In Maryland, there are several Adventist-affiliated hospitals, but a unique state law regulating hospital prices means uninsured patients get the same rates as people with health coverage.

Here in St. Louis, it was unclear whether Forbes was having much impact; the thousands of Adventists barely broke stride as they passed the ragtag group protesting the conference they were attending.

"I don't even know if it's real," said M. Dinorah Rivera as she scanned a flier that accused Adventists of letting church-affiliated hospitals "turn their backs on our stated mission of healing."

Elsewhere in the health care industry, Forbes's street theater has been met with a mix of scorn and consternation, because he is one of the few people to have scored a major victory against the hospital industry.

"K.B. Forbes came knocking on our door several years ago complaining about this very same issue," said Harry Anderson, a spokesman for Tenet Healthcare Corp. who described the early encounters as "not very friendly." Still, Anderson said Forbes is "a passionate believer . . . a very formidable advocate."

So formidable that two years ago, Tenet agreed to Forbes's demands for deep discounts for the uninsured. Through its "Compact With the Uninsured," Tenet's 69 hospitals in 13 states gave about 80,000 uninsured patients the same reduced price given to local managed care companies, about 45 percent less than published rates.

At the core of the fight to help the indigent is a Byzantine billing system in which hospitals start with one standard set of prices and then give deep discounts to government purchasers and private insurers. The result: People without insurance are the only ones charged full price, often triple what insured customers pay.

Hospitals say that negotiating bulk discounts for major buyers is simply the free-market system at work. But advocates for the poor, a well-financed coalition of trial lawyers and a growing number of lawmakers argue the system is so out-of-whack that it amounts to a violation of consumer protection laws.

"It is illegal to charge [uninsured patients] three, four and five times what they charge other people," said Archie Lamb, a Birmingham lawyer handling several of the cases. "It is price gouging, and it is unfair."

At Florida Hospital, a standard appendectomy costs Medicare about $4,000 and private insurers $4,572, Lamb said. A patient without insurance would be charged $13,000 to $15,000 for the same surgery, he said.

Rodney Vega's brain tumor was discovered by chance after a car accident in Venezuela. After two operations there, the family moved to Florida in search of more sophisticated treatment. The family paid Florida Hospital $800 for a brain scan in 2002, which was later refunded. The two sides vehemently disagree over Montilla Vega's assertions that the hospital said surgery would cost them $20,000.

When a physician at Jackson Memorial Hospital in Miami told her Rodney had two weeks to live, Montilla Vega called Forbes in tears, begging for help. He, in turn, phoned his former nemeses at Tenet who, in the 2003 settlement, agreed to provide discounted care on an ad hoc basis to people Forbes said had run out of options.

Since then, the boy, who is disabled as a result of a stroke during his first surgery, has had three more operations at Tenet's St. Christopher's Hospital for Children in Philadelphia. The family is moving to Philadelphia to continue his therapy and make an end-of-life plan known as palliative care, said Rodney's physician, neurosurgery chief Joseph Piatt.

In the case against Florida Hospital, Forbes is using more than the woe of Rodney Vega. Forbes has compiled an avalanche of data on huge compensation packages for Adventist Health executives and the hospital's partnership with the National Basketball Association's Orlando Magic.

One pink flier distributed in St. Louis castigated the hospital for its joint venture with the team on the RDV Sportsplex, a for-profit fitness rehabilitation center, noting: "We turn people away who need help, price gouge those without health insurance, and use the profits to help millionaire basketball players? Is this what Jesus wants?"

Rich Morrison, the hospital's regional vice president for government relations, said such ventures are a common "way for hospitals to get involved in the health side."

The 1,750-bed hospital refuses to negotiate a pricing policy, Morrison said, because of Forbes's "strong arm" tactics.

Forbes, 38, the son of an Irishman and a Chilean immigrant, honed his spinning skills selling Republican presidential candidates Pat Buchanan and Steve Forbes. Critics say K.B. Forbes (no relation to Steve Forbes) is a front man for insurance giant and GOP donor J. Patrick Rooney.

Forbes said Rooney's Fairness Foundation paid him before this year and offered him $100,000 in seed money for advertising to help launch his investigation into alleged hospital gouging, but it was not needed. But Forbes said the accusations about him, his relationships and motives "are a pathetic attempt by the hospitals to deflect attention away from their own deplorable and egregious behavior."

Morrison agreed that hospital pricing has become a convoluted, illogical system of shifting costs from one payer to another. But he and other executives contend that the answer is not to squeeze hospitals, but to devise a national solution for treating the uninsured.

Forbes countered with IRS reports showing comfortable operating margins by Florida Hospital and others in the Adventist system. And although the Adventists were the first hit in Forbes's new assault, he intends to stage similar events in Denver this month to try to embarrass Catholic hospitals.

[cricket]

Hmm. The Washington Post was covering this protest on July 10th. It is making headlines on August 22nd? Strange.

Quote:

---

Here in St. Louis, it was unclear whether Forbes was having much impact; the thousands of Adventists barely broke stride as they passed the ragtag group protesting the conference they were attending.

---

In all fairness, this protest was taking place on a corner near the least used entrance to the GC Session. They were very well out of sight of most of the attendees. It is a far stretch of the imagination to say that thousands of Adventists passed by, or were even aware of this protest.

As there were many, many other people "pushing" their agendas on the crowds, it is no wonder that the few people who were exposed to this protest took little notice.

[Gregory Matthews]

The system has gone wrong, and knowledgeable people agree. The fix is not agreeded upon by all people.

Here is one aspect of the problem: Contracts require discounts. If the standard rate is lowered to the present discounted rate, then the discounted rate must be further discounted off of that rate.

Here is another aspect of the problem: I, who am on a Federal government program of health care, often pay one-third of the standard rate for medications. One reason for that is that the medication was often developed through a Federal research grant. As such, the requirerment is that the the developmental costs cannot be considered when the price for my prescription is determined, as research costs have already been paid by the Federal government.

I do not suggest that there is no problem, and that there is not solution. I simply say that the problem is complex.

You know, it is the system that requires a hospital to bill $15.00 for a 5-cent asprin dispensed to a patient.

[Barbara]

I know that our hospital never requires us to pay up front for severices. They bill our insurance firisst and then will work out a payment plan for us that wont break us.

[NormF]

If you're fortunate enough to have insurance. <img src="/ubbtreads/images/graemlins/frown.gif" alt="" />

[Fran]

Gregory;

I agree with you. I believe there is much more to the story. The story doesn't provide much information.

I praise God I do not sit in the chair of the person making the decisions. I understand the Adventist Health System cannot be everything to every man.

The horrible part is for those with no insurance. Just where does all this money come from? It comes from the billing of patients that have insurance companies that do pay.

I agree. This is very complex.

Greg, I hope they don't hit your hospital too.

[Gregory Matthews]

Re: "Greg, I hope they don't hit your hospital too."

I work in a hospital that does not charge (I will list exceptions next.) for any of it's medical care. If it gives a heart transplant, the patient pays nothing. This hospital brings in whatever experts are needed to provide the medical care, and the patient is charged nothing. If we do not feel that we can provide the care, we send the patient to a near-by hospital, and the patient pays nothing. In some cases, we fly the patient by air ambulance to care facilities in other states (Salt Lake City, UT, is one common place.) and the patient pays nothing.

Now for the exceptions:

1) In some cases we require that the patient pay $2.00 for a 30 day supply of prescription medications. Other patients pay nothing. That co-pay is only for out-patient care.

2) In contrast to other hospitals, we do a very large out-patient business. In some cases, we have agreed to provide out-patient care to people who have agreed to pay a co-pay. The out-patient co-pay is capped at $50.00 per day. This means that many who pay this co-pay pay less. But, no one pays more.

3) We also have a capped co-pay for in-patient care. I do not have that figure available to me at the moment.

4) The bottom line is that most of our patients do NOT pay this co-pay. We can often spend in excess of $100,000.00 on a patient who pays us nothing. When we get into transplants, we spend much more than that. When we have a patient in one of our Intensive Care Units, for several weeks, we spend big money, and the patient pays nothing.

5) Our care is primarily medical. But, in some cases we provide dental and optical care. When that is provided, it costs the patient noting. Last week this hospital placed the third crown on a tooth of mine, at no cost to me. They will soon be evaulating a 4th tooth to see if it can be saved, or will need a crown.

NOTE: FYI, I work in a hospital that is NOT a public hospital. It is here to serve patients who have served the United States in the military, and as a result of that service have been determined to have sustained illnesses or injuries.

If you walked into our Emergency Department, stated that you were a veteran, and that you were having left chest pain, we would provide you with immediate evaulation and treatment. If we later discovered that you were not entitled to recieve treatment from us, we would bill you for the capped amounts that I have listed above.

On a personal basis, the medical, dental, optical, etc. care that I recieve at this hospital is due to a determination that I have sustained illnesses or injuries as a result of my military service. Because I am a retired military officer, my family and I also are entitled to recieve medical care outside of this hospital, in the community.

[Fran]

Gregory;

There is no free lunch. The tab has to get paid or the doors would close. The benefits you and your family receive are at the expense of the Federal Government.

We are retired military. If it were not for that medical benefit, I would have died years ago. I am grateful for that benefit for my husband’s years of service in the military.

We don't live near a veterans or military medical facility near by. I wish we did. Your facility sounds like it is a top rated facility.

How do we solve the problem of covering medical care for all of the uninsured at non-profit facilities?

Those expensive drugs from hospitals have to help pay for the electricity, water, heat and air. What about the nurses and technicians? Who pays for the oxygen? My bill is over $500.00 per week with the rental of the huge tanks. I pay nothing because of the benefits you and I share. But somebody pays. There is no free lunch.

This particular story raises many questions in my mind. The child has had 5 surgeries and a stroke and the care he is receiving now is not surgery. I can't help but think it was not to the child’s advantage to operate since the child is now on an end-of-life program. The new hospital did not offer the surgery either.

I see desperate parents willing to do anything to save their child. I would have wanted the surgery too just to make sure that everything possible was done to save my child even if it cost a million dollars.

Now, as for "huge compensation packages for Adventist Health executives and the hospital's partnership with the National Basketball Association's Orlando Magic" I have a different set of questions.

[Bravus]

Still, pity the fool{/Mr T} who suggests that some form of socialised health care that looks after everyone in the country might be part of the solution...

[Fran]

I forgot to mention that the deal with the basketball thing could be a win, win partnership. They will receive full payment for any services provided. That in turn could be used to fund the uninsured??????

[Gregory Matthews]

Re: "How do we solve the problem of covering medical care for all of the uninsured at non-profit facilities?"

I do not have an answer.

The situation is so complex, and the answers are not easy.

My comment was simply to say that we provide good care to many people who could not otherwise afford what they need. Yes, there clearly is a cost, and that cost is born by the people who pay the taxes. But, it should be. The military have placed their lives on the line for this country. They have already paid the costs, if you want to call it like that. Their bill is paid, and now it should be the obligation of the people of the U.S. to pay for the care that they need.

[Fran]

Gregory;

You are right. It is a complex problem.

I am also thankful for the benefits we are receiving after the fact. I am thankful that God has taken care of the military even after their service.

Your hospital sounds top notch. I wish all Veterans Hospitals were the same.

[]http://www.emotipad.com/emoticons/Flowers.gif[/] In fact your facility deserves flowers for a job well done.[]http://www.emotipad.com/emoticons/Mexican%20Wave.gif[/]

[Tom Wetmore]

As is so often the case, there is usually much more to a story than meets the eye. It would seem that J Patrick Rooney, the one that Mr. Forbes is fronting for, has substantial ulterior motives for pushing this particular story. While there is without a doubt a serious healthcare crisis in the skyrocketing costs and who gets to pay for the uninsured or under insured, it does ring rather hollow for the one pushing these claims of overcharging at hospitals to be grossly underpaying on claims of those who purchased healtcare insurance through his insurance company. Obviously, his profit motive as a healthcare insurer is to pay as little as possible. One might ask if he charges his healthcare insurance premiums on a sliding scale according to his customers' ability to pay... And time will tell after all the dust settles on the lawsuits against him how his premiums compare to those of other insurance companies relative to the "coverage" received...

Here is an article from today's Tampa Tribune about a company founded by J. Patrick Rooney, who, the Washington Post reported, was the man behind K.B. Forbes:

Aug 31, 2005

Medical Insurance Provider Scrutinized

By CAROL GENTRY

[]cgentry@tampatrib.com[/]

TAMPA - State regulators are conducting a review of the business practices of Medical Savings Insurance Co., a small company that sells moderately priced health coverage in Florida, court documents show.

Citing confidentiality requirements, the Florida Office of Insurance Regulation would not confirm that an inquiry, called a ``market-conduct examination,'' is under way.

But Alan Nisberg, a Tampa- based attorney for Medical Savings, said the matter is probably just a routine review, like a bank audit.

Beth Scott, a spokeswoman for the Office of Insurance Regulation, said such examinations are typically triggered by specific concerns, such as reports from other states, or complaints.

Medical Savings has undergone regulatory scrutiny in at least four other states, court and other documents show, for its practice of paying only the part of a hospital bill that it considers ``reasonable.''

In Florida at least, that practice has left some of the company's customers in the position of being billed for the balance, said Jeff Liggio, a West Palm Beach lawyer who represents a group of patients seeking class-action status in a suit against Medical Savings.

``They didn't sell insurance. They sold an illusion of insurance,'' Liggio said. Some hospitals have brought suit against patients, court records show. Meanwhile, more than two dozen Florida hospitals have sued Medical Savings for alleged under-payment.

Medical Savings countered in 2004 with an antitrust case, accusing the Florida Hospital Association and various members of price fixing, overcharging and coordinating a boycott against the company. The case was dismissed, but Medical Savings is appealing.

Company executives did not respond to repeated requests for interviews. But court documents in some of the suits show that the company believes it is being overcharged by hospitals.

``Hospital prices are outrageous,'' Nisberg, the attorney, said.

Randal Suttles, Medical Savings' president, testified in a May deposition taken for one lawsuit: ``We cut the bill to a reasonable amount.''

The company decided that for most hospital bills, a reasonable amount would be the Medicare reimbursement rate - typically about break-even on cost - plus 26 percent.

Hospitals that treated Medical Savings customers found payments were often less than half the bill - sometimes as low as 20 percent, said Liggio, the lawyer. Medical Savings made out reimbursement checks so that cashing them constituted ``payment in full.'' As a result, many hospitals refused to cash them.

Among the hospitals that are suing the company are H. Lee Moffitt Cancer Center in Tampa and HCA-owned hospitals in Florida, including South Bay in Brandon. One of the largest Florida cases against Medical Savings was filed in Orlando in 2003 by Adventist Health System Inc. Adventist sought $1.4 million, but the case was settled last month for $850,000.

Insurance carriers that have large memberships, such as Aetna Inc. or Blue Cross and Blue Shield of Florida, typically negotiate discounts off the retail rate. Those discounts, which are kept confidential, can be substantial.

But a relatively small company like Medical Savings would have little clout negotiating such discounts. It has about 15,000 customers in Florida, attorney Nisberg said, constituting about 30 percent of the company's business.

Medical Savings Insurance Co., a wholly owned subsidiary of Medical Savings Investment Inc. of Indianapolis, specializes in the sale of high-deductible hospital policies and tax- advantaged health savings accounts allowed under federal law. The company's founder, J. Patrick Rooney, has been called ``the father of medical savings accounts.''

Legal documents show that regulators in four other states - Arizona, Arkansas, Ohio and Oklahoma - have conducted examinations of the company's business practices.

A 2002 report by Oklahoma's insurance commissioner cited the company for making discounted payments without having a legal contract to do so in 83 of the 102 claims studied.

This story can be found at: http://news.tbo.com/news/MGB4PBXV0DE.html