Hospitals To Cease Improper Patient Billing


Consumers who pay hospital bills for which they are not responsible will receive protection under agreements announced today between Attorney General Spitzer and Beth Israel Medical Center and New York - Presbyterian Hospital. The settlements are the latest in the Attorney General's ongoing statewide "Project Clean Bills of Health" initiative to eliminate improper medical billing.

Under the terms of the agreements, each hospital will provide refunds to consumers who were improperly billed for services that were covered by their health insurance plans. In addition, both hospitals agreed to reform their billing practices. Specifically, the hospitals agreed that, when they submit bills to health plans, they will not bill consumers until the plan notifies them that the consumer may be liable.

"The last thing a recovering hospital patient should have to deal with is an illegitimate medical bill," said Spitzer. "My office will protect consumers from unknowingly paying for hospital care that should have been paid for by the health plan. Project Clean Bills of Health will continue until this improper practice has ended."

The Attorney General's Health Care Bureau investigated the hospitals after receiving complaints from consumers who received bills and letters from the hospitals threatening financial liability, even though the hospitals were participating providers with the consumers' health plan and the consumers had followed all the rules of their health insurance coverage. Spitzer's office determined that the hospitals had improperly "balance billed" some consumers by attempting to collect the bill from the individual after the health plan had failed to respond to the claim.

Spitzer's office also found that certain letters to consumers contained potentially misleading language that suggested that the consumer would be liable for amounts which, by law or contract, were not in fact the consumer's responsibility.

Under New York law, applicable to health maintenance organizations, as well as under many contracts between health plans and hospitals, a hospital cannot bill a consumer if the consumer is properly enrolled in the health plan, the services provided are included in the consumer's policy and the consumer followed all the procedural rules in the policy prior to receiving the services. In these instances, the hospital and the health plan should resolve any coverage problems without billing the consumer. Exceptions to this billing prohibition include bills for deductibles, co-insurance, co-payments or other amounts specifically designated by the health plan as the consumer's responsibility.

The Attorney General commended both Beth Israel Medical Center and New York - Presbyterian Hospital for their cooperation in the investigation.

For the past three years, the Attorney General's Health Care Bureau has engaged in "Project Clean Bills of Health" - a series of investigations into policies and practices related to balance billing by health care entities, including HMOs, hospitals, ambulance companies and diagnostic testing labs. In addition to these settlements, the initiative has resulted in settlements with MDS Labs, Quest Diagnostics, WellCare of New York and Vineall Ambulance.

Individuals who believe that they have been improperly billed by Beth Israel Medical Center and New York - Presbyterian Hospital may file refund requests with the hospitals as follows:

Beth Israel Medical Center: Kisha A. Owen, Customer Service, Continuum Health Partners, at (212) 256-3023.

New York - Presbyterian Hospital: Patient Financial Services at (212) 297-5424.

Consumers and providers with other questions about health care matters can call the Attorney General's Health Care Bureau Hotline at 1-800-771-7755 (option 3).

The investigations were conducted by Assistant Attorneys General Paul Beyer and Susan Kirchheimer, under the direction of Health Care Bureau Chief Joe Baker and Deputy Bureau Chief Troy Oechsner.



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