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A woman went to the emergency room of a hospital in Pennsylvania two years ago with severe pain in her shoulder. She had already been to a local clinic, but the doctors there told her there was nothing they could do. They recommended an MRI. But the woman had no health insurance, and the estimated cost of the MRI was $1,000. She lived with the pain until she couldn’t stand it. When she got to the emergency room, the woman asked the triage nurse for information on charity care coverage for services. After being bounced to a clerk and then to a case manager, she learned that even if she met the hospital’s financial criteria for free care, she could not be assured that any treatment she received would be covered. Rather than risk incurring an expense she couldn’t afford, the woman left. The hospital sent her a bill anyway, for $130. She wrote to the billing office and explained what had happened. The hospital forwarded the bill to a collection agency. The woman called the helpline of the Pennsylvania Health Law Project earlier this month because the bill now appears on her credit report. There is a myth that if people in the United States need medical treatment, they can simply go to a hospital emergency room. The law and common practice are quite different. Under the federal Emergency Medical Treatment and Active Labor Act, hospitals that participate in Medicare (and virtually all do) and run an emergency room cannot turn away, transfer or discharge women in active labor or others with emergencies before stabilizing them. In the Health Law Project’s experience, this works pretty well in providing hospital access for folks with classic emergencies but not for anyone else without adequate insurance � the people who need a biopsy or some other form of treatment. But even the folks with classic emergencies ultimately get a hospital bill. The hospital in question is part of a large hospital system. Last year, the state Office of Medical Assistance Programs paid that system more than $2.89 million in “outpatient disproportionate share” funds because the hospital serves a minimum percentage of low-income people. Medical Assistance paid the same hospital system another $3.27 million in “inpatient disproportionate share” over the same period. And in 2006, the year the woman was billed $130 for asking about charity care, the hospital system qualified for a separate $5 million in “uncompensated care” funds, which Pennsylvania distributes under the Tobacco Settlement Act of 2001, to promote access to care for uninsured patients. A full analysis of the additional tax break that the hospital received as a result of its nonprofit status would take much more space than has been allotted for this article. However, just two months ago, the hospital reached an agreement with its local school district to pledge $100 million over 10 years for a local scholarship fund, in return for a promise not to challenge the hospital system’s nonprofit tax exemption. The case points up the problem with Pennsylvania’s rules around the provision of hospital charity care. Basically, there are none � at least none that grant a low-income person with no or inadequate insurance the right to free or low-cost services. The disproportionate share rules do not require that a hospital provide free or low-cost care to anyone. The $100 million pledge in lieu of taxes provides no free health care for the hospital’s patients, but instead diverts funds from the mission of the hospital. Only the Tobacco Settlement Act offers anything approaching an individual right to free or discounted care. Under the Tobacco Settlement Act, 35 P.S. Sec. 5701.1104(b), in order to apply for uncompensated care funds, a hospital must have “a plan in place to serve the uninsured.” Pennsylvania sets no rules, however, regarding how much free or discounted care must be given away, what services must be covered, who must qualify or how free care is to be valued. The state has promulgated no process for notifying perspective applicants of the availability of free care other than the statutory requirement that it post “adequate notice of the availability of medical services and the obligations of hospitals to provide free services.” No requirement for fair and timely adjudication of applications exists. In short, Pennsylvania fails to clarify what passes as a bona fide uncompensated care plan. A number of states, including California and New York, have defined what hospitals must do for patients in return for disproportionate payments and tax breaks. Gov. Arnold Schwarzenegger of California has gone so far as to establish a state-sponsored Web site (http://syfphr.oshpd.ca.gov), which enables the public to view any hospital’s charity care plan. Pennsylvania is severely lagging, despite Gov. Edward G. Rendell’s indication that his “Prescription for Pennsylvania” would bring about changes. The hospital system in this case posts its application for financial assistance online. A reading of that application may begin to explain how the system reportedly posted a $618 million profit last year. The instructions to the five-page application welcome the prospective applicant with the warning, “Your application MUST be complete or your application will be denied.” Among the required pieces of information for a completed application are pay stubs for the last three months (or the reason you do not have a job), your most recent federal income tax return with appropriate schedules (or a written statement that you are not required to file and the reason why), and the quote from your former employer for the cost of COBRA coverage if you lost your job within the past 18 months. And they don’t just ask if you are married or single, they want to know if you are divorced, separated or widowed. In the case at hand, the woman ultimately was able to find a different hospital that accepted her application for charity care. She was seen by an orthopedic specialist who got her into physical therapy, which was paid for by the patient assistance program. The hospital that did what many would call the right thing paid the price. And the hospital that charged $130 to ask about its charity care plan? We have that under advisement. Michael J. Campbell is the executive director and co-founder of the Pennsylvania Health Law Project, located in Philadelphia. He can be contacted by calling 1-800-274-3258 or by e-mail at [email protected].

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