Albany Hospital To Cease Improper Patient Billing

Attorney General Spitzer announced a settlement with Albany Medical Center today that will protect consumers from getting hospital bills for charges for which they are not responsible.

The settlement is the latest in the statewide "Clean Bills of Health" project of the Attorney General's office which yielded similar settlements with two other hospitals in February.

Under the terms of the agreement, Albany Med has agreed to reform its billing practices. Specifically, Albany Med has agreed that, when it submits reimbursement claims to health plans, the hospital will not bill the consumer until his/her health plan provides notification that the consumer may be liable.

"Improper medical billing can be financially devastating, particularly for consumers who do not understand the intricacies of hospital billing," Spitzer said. "The Clean Bills of Health Project will continue until this practice is completely eliminated in New York."

The Attorney General's Health Care Bureau investigated Albany Med after receiving complaints from consumers who received bills from the hospital for services, even though the hospital was a participating provider with the consumers' health plans and the consumers had followed all the rules of their coverage.

Spitzer's office also discovered that certain letters to consumers contained potentially misleading language that suggested that the consumers would be liable for amounts which, by law or contract, were not in fact the consumers' responsibility. Unlike other hospitals and health care entities found to have improperly billed, however, Albany Medical Center only billed and sent misleading letters under limited circumstances, resulting in few instances of actual balance billing.

Albany Med cooperated fully with the investigation and has agreed to improve its billing practices.

For the past three years, the Attorney General's Health Care Bureau has conducted a series of investigations into improper billing practices by various health care entities, including hospitals, HMOs, ambulance companies and diagnostic testing labs. In addition to the settlement announced today, the initiative has resulted in settlements with MDS Labs, Quest Diagnostics, WellCare of New York, Empire Blue Cross Blue Shield, Vineall Ambulance and most recently, Beth Israel Medical Center and New York-Presbyterian Hospital.

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 a 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 plans as the consumer's responsibility.

Individuals who believe they have been improperly billed can call the Attorney General's Health Care Bureau Hotline at 1-800-771-7755 (option 3).

The investigation was conducted by Assistant Attorney General Paul Beyer, under the direction of Health Care Bureau Chief Joe Baker.