Healthcare In Crisis: Uninsured hospital patients may get price-breaks

Tuesday, June 3, 2008

Uninsured hospital patients may get price-breaks

"Hundreds of thousands of people in Illinois will face lower health care costs under new legislation passed in Springfield and now on its way to the governor.

The legislation ensures that uninsured patients get discounted rates for hospital care instead of paying the full list price. And the financial responsibility will rest with hospitals, not with the state.

Think of a car dealer that gives price breaks to high-volume customers but stiffs the guy who walks in off the street, refusing to bargain down the price. That’s the way hospital billing has worked until now: People with insurance get discounts and the uninsured pay two to three times more.

The new legislation jettisons those hospital billing practices. Instead, almost everyone without insurance will now be charged what it actually costs a hospital to provide care plus a markup of 35 percent.

The Illinois Hospital Association insisted on income standards, but they’re generous. To qualify for discounts, patients in urban areas can make up to $62,400 for an individual and $127,200 for a family of four (600 percent of the federal poverty level). In rural areas, where incomes are lower, the threshold is lower, at $31,200 for an individual or $63,600 for a family of four (300 percent of poverty).

The Illinois Attorney General’s Office, which fought hard for the legislation, estimates that more than 83 percent of uninsured families in the state – about 776,720 families – will meet those standards.

The only state that has a similar plan is Tennessee, and it allows a markup of 75 percent above hospital costs, forcing patients to pay more than they will here.

The legislation here also contains a first-of-its-kind provision that will limit the amount that people without insurance pay for hospital services in any given year to 25 percent of their gross annual income. To qualify, people would have to meet an asset test. For a family of four in Chicago, assets of up to $127,200 would be allowable."

(full article)

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Statistics Collection

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