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Md. lawmakers to tackle medical debt proposals

Robbyn Lewis has been appointed by Gov. Hogan to fill a vacant seat in the House of Delegates. (Submitted photo)

Del. Robbyn Lewis, D-Baltimore, is one of two lawmakers who plan legislation to address hospital billing and debt collection practices. (Submitted photo)

ANNAPOLIS — Maryland lawmakers plan to take a look at how the state’s hospitals determine whether patients can pay and how hospitals collect payment from patients who struggle with their bills.

Dels. Robbyn Lewis, D-Baltimore, and Lorig Charkoudian, D-Montgomery, will file separate pieces of legislation to address hospital billing practices and debt collection practices after questions about patients who have been sued for unpaid bills were raised last year.

Over a decade, Maryland hospitals sought more than $268 million in debt from patients through the courts, Lewis said, citing data from the Maryland judiciary.

That represents a regulatory framework that is not serving hospitals or patients, she said.

Tequila Terry, a deputy director of the state’s Health Services Cost Review Commission, which regulates Maryland hospitals, briefed the House Health and Government Operations Committee on the role her agency plays in financial assistance for patients.

Hospitals across Maryland have a standardized form for patients who request financial assistance to fill out. Depending on their income, they could be eligible for free or reduced care. If their income level is too high they must pay the full bill, though most hospitals offer payment plans.

Hospitals can write off charity care through the state’s uncompensated care fund. They can also write off a portion of bad debt, bills that have gone unpaid, if they pursue reasonable efforts to collect payment.

That is where new legislation to clarify what a reasonable effort may come into play.

“These questions about what does it look like to make reasonable attempts are some of the things that are missing in our statute,” Charkoudian said.

Her legislation will specify what hospitals must do and how they must attempt to contact patients before they can pursue the debt through the courts. There would also be a threshold for what level of debt hospitals can pursue.

The HSCRC said suing patients is not a current state requirement to prove that a reasonable effort to collect the debt has been made, but some federal regulations may require it.

One issue for hospitals is how they end up in a position where debt is accruing. One element is the rise of cost-sharing as a portion of health insurance plans, Bob Atlas, president and CEO of the Maryland Hospital Association, told the committee.

The number of health insurance plans that include patient copays, coinsurance and deductibles has been steadily rising. Patients who think they are covered by insurance can be surprised when they have to pay some of the bills.

“To make health insurance look affordable, that is to keep premiums down, carriers are exposing consumers to ever greater financial obligations when they need health care services,” Atlas said. “We’re talking about exposing patients to thousands of dollars in health costs before their insurance kicks in.”

That trend was a reason cited by the HSCRC when it asked private health insurance plans to pay more than public payers, like Medicaid and Medicare, into Maryland’s uncompensated care fund.

Another issue could be that patients are finding it difficult to learn about what financial assistance options are available, whether it is because they are more focused on their medical care or because they do not understand the written notices that are available.

Currently, hospitals must post notices in public spaces of the hospital that financial assistance is available. They must notify patients when they arrive seeking care, before they are discharged, when they receive a hospital bill and any time a patient asks about financial assistance.

Lewis’ bill would increase the thresholds for eligibility for financial assistance and make presumptive assistance easier for patients and hospital staff. The legislation also would increase notice of financial assistance, including oral notice and written notice in a patient’s primary language, and provide a complaint and remedy process.

The bills from Charkoudian and Lewis have not yet been drafted.


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