While non-profit hospitals are subject to some rules to protect patients from unfair billing practices, many of the federal government's rules do not apply to for-profit and government-run hospitals. Study by Andy Dean Photography/Shutterstock
ATLANTA, Aug. 17 (UPI) -- Current rules for hospitals on billing and collections aimed at protecting patients were deemed unfair in a study reviewing the practices of facilities in 14 states.
Differences in requirements for nonprofits versus for-profit and government-run hospitals, in addition to hospital discretion to determine financial assistance eligibility, don't live up to the goals of the Patient Protection and Affordable Care Act of 2010.
The legislation, most well-known for its creation of the health insurance marketplace popularly referred to as ObamaCare, set in place rules for tax-exempt hospitals. These rules include publicizing information on financial assistance, limit the amounts charged to patients eligible for assistance, and barring hospitals from "extraordinary collections actions."
"Although the IRS rules aim to protect vulnerable patients from unfair hospital billing and collection practices, the rules are distressingly underinclusive and create unjustifiable gaps in protection," Fuse Brown wrote in the study, published in the American Marketing Association's Journal of Ethics.
Fuse Brown wrote that roughly 40 percent of all hospitals in the United States are either for-profit or government-run, so the new IRS regulations do not apply. She adds that hospitals have complete discretion on determining eligibility for assistance, suggesting that the potential for overly narrow requirements already is causing harm to patients.
"I expected to see more of a standard industry practice emerging for hospital financial assistance and charity care," Fuse Brown said in a press release. "But the policies are all over the map and patients still have no idea when they go to a hospital what the financial bottom line will be for them."
She wrote in the study, which included surveys of 140 hospitals in 14 states, the regulations for tax-exempt hospitals should be expanded to all facilities and that restrictions on unfair collections practices should be ruled out for all facilities. Guidelines that apply to all hospitals, as opposed to differences from facility to facility, also should be mandated for the sake of patients, she wrote.
"Patients ought to be treated fairly by all hospitals, which have a duty to avoid inflicting not only physical harms on their patients but also unjustifiable financial harms," Fuse Brown wrote. "It is time to broaden the protections of fair hospital billing and collection practices to all hospitals and financially vulnerable patients.