Upfront Hospital Payments on the Rise

April 29, 2008 10:49 AM
by findingDulcinea Staff
The case of a leukemia patient told to pay before receiving chemotherapy at a Texas hospital highlights a growing trend among nonprofit hospitals.

30-Second Summary

M.D. Anderson Cancer Center in Houston, Texas, did not accept Lisa Kelly’s limited-benefit insurance, and asked Kelly to pay a total of $105,000 before it would admit her for chemotherapy treatment. The hospital eventually “overrode” the request, but demanded upfront payments for each of Kelly’s return treatments, no matter how minor.

Hospital officials argued that the cash-before-care demands were legitimate because Kelly was not indigent—a type of patient nonprofit hospitals regularly provide for—but underinsured.

More and more nonprofit hospitals, citing unpaid bills, are asking patients to pay for procedures upfront. But an Ohio State University study also found that nonprofit hospital income tripled from 2000 to 2005, according to the Wall Street Journal.

In another effort to reduce the amount of unpaid bills, many hospitals are turning to credit agencies to check financial backgrounds before they admit a patient. This process is popular with for-profit hospitals, too. Patient credit scores aren’t affected, but the practice “raises privacy issues” and can affect a hospital’s decision to treat a patient, reported the Journal March 18.

Headline Link: Payment first, chemotherapy second

Background: Scrutinizing hospitals, scrutinizing patients

Nonprofit hospitals investigated
Patients screened before treatments

Reference: Government Accountability Office Studies Hospital Practices


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