"Everybody starts off at the same place," says Paul Kappelman, Northwest Medical Center's chief executive officer. After that, insurance companies negotiate substantial discounts, but that doesn't mean the uninsured are left with the highest bills, he says.
To determine a patient's ability to pay, Kappelman says: "We work with people individually and try to get them hooked up with AHCCCS (Arizona's health care program for low-income people). We do whatever we can."
Julia Strange, a spokeswoman for Tucson Medical Center, says her hospital does the same. "Between 85 and 90 percent of uninsured patients get assistance," she says.
For those who don't qualify for AHCCCS, Strange says, the goal is to develop "a reasonable and acceptable payment program through open communication. Our goal is to find a solution for both sides."
While University Medical Center also works with people on their hospital charges, they additionally offer their special Uninsured Patient Discount Program. Physician bills, however, are handled separately.
Since 2004, UMC has provided the uninsured and underinsured with "the same discounts on their hospital bills as those who are insured through Medicare." Those charges, says a UMC press release, "may be as much as 80 percent less than published rates."
Significantly discounted Medicare charges are one reason why the American Hospital Association in 2006 adopted suggested billing guidelines that are partially linked to these low rates for uninsured patients. For those earning between 100 and 200 percent of the federal poverty income, the AHA recommends hospital charges not exceed 125 percent of the Medicare-approved rate. The group suggests that people with incomes below the federal poverty level receive service at no charge.
The UMC program, combined with AHCCCS, approximates these recommendations. But such a program is an exception, especially at the national level.
A Health Affairs journal article by Gerard Anderson, professor of health policy and management at the Johns Hopkins Bloomberg School of Public Health in Baltimore, concluded that in 2004, "the rates charged to many uninsured and other 'self-pay' patients for hospital services were often 2.5 times what most health insurers actually paid."
That statistic, Anderson points out, is the polar opposite of how things once were in this country. "Fifty years ago," he writes, "the poor and uninsured were often charged the lowest prices for medical services."
The gap between charges for the uninsured and those with insurance is also probably widening. As hospital costs increase faster than Medicare reimbursable amounts, some of the difference could be shifted to uninsured patients.
Despite being charged much higher amounts, Anderson reports the uninsured typically pay merely 10 percent of their hospital bills. This is one reason why hospitals, on average, actually only collect 39 cents of every $1 in charges they make.
That may be the case nationally, but UMC spokeswoman Katie Riley thinks her hospital's discount program for the uninsured could be having a positive impact on people paying their hospital bills.
"Anecdotally," she suggests, "we've seen people making a bigger attempt to pay their bills since the policy was put in place."
Strange says TMC has a sliding scale of charges for people who earn less than 400 percent of the poverty level. Acknowledging that it benefits both the patient and the hospital if a payment plan for services can be agreed upon, she stresses: "We try to come up with a plan that's reasonable."
According to Strange, in 2006, TMC provided charity care to 5,500 individuals. That meant $800,000 was paid in sliding-scale fees by patients, while more than $8 million worth of services were provided at no charge.
Regardless of these efforts, both Strange and Kappelman concede that the number of people not paying their hospital bills is increasing.
"Bad debts are rising faster than ever before," Kappelman says. Bad debt is more than a $1 million-a-month problem at his hospital, he says. It is even higher than that at TMC, according to Strange.
Kappelman indicates that nationwide, the percentage of people not paying any of their hospital bills has jumped as high as 10 percent. One of the results of this is that hospitals lose money on uninsured patients.
Despite that, both Kappelman and Strange strongly encourage uninsured people needing medical attention to get it quickly.
"If it's a nonemergency situation," Kappelman says, "they can call the hospital first and work out a rate they can pay. In an emergency, they should go to the ER. If they don't have the means to pay, we'll work with them in a cooperative manner."
Strange from TMC says of the uninsured: "They shouldn't shy away from health care. At clinics in town (El Rio, St. Elizabeth of Hungary), they can get care as soon as possible. They shouldn't wait until it's an emergency."
It's unknown how many Americans don't seek medical care because they fear incurring an unpayable bill. In an e-mail message, Anderson said his research didn't look at patient-level data which would have addressed that question. However, he did have a personal observation.
"I have worked with a number of uninsured persons over the years on this issue," he writes about people avoiding medical care because of high hospital charges, "and my experience is, yes (it does affect them)."
