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Hospital Billing Practices for Uninsured Patients

The Boston Globe on Sunday examined the "imbalanced system" of billing practices, under which hospitals charge health insurers less than uninsured patients for the same services, that has become the "subject of a number of complaints, lawsuits and congressional hearings."

Many hospital officials had said that federal rules prohibited discounts for uninsured patients, but HHS Secretary Tommy Thompson in February refuted those claims. However, many hospitals are "struggling to develop discount policies" because they remain "caught in a system ... that is difficult to alter," the Globe reports.

Under the system, health insurers negotiate volume discounts with hospitals, and public health coverage programs often do not cover the full cost of services. As a result, many hospitals charge uninsured patients, as well as health insurers with few members and "little negotiating clout," more for services to "make up for those losses," the Globe reports.

Sally Mason Boemer, Massachusetts General Hospital vice president for finance, added that if hospitals were to provide discounts for uninsured patients, health insurers might seek larger discounts. Peter Markell, vice president of finance for Massachusetts General's parent company Partners HealthCare, said the company hopes to develop a discount policy for inpatient services that would apply to all uninsured patients, although health insurers would continue to receive larger discounts (Kowalczyk, Boston Globe, 11/7).