ACA 'fair pricing' requirement languishes without enforcement

Lax enforcement and lack of clarity of the "fair pricing" provision of the Affordable Care Act are undermining the intended goal of preventing hospital bills from bankrupting uninsured patients, the Associated Press reports.

The ACA requires that nonprofit hospitals charge uninsured patients the lower rates that insurance companies negotiate for their members. But according to the AP, critics say the following barriers are preventing that from happening:

  • Forty percent of for-profit community hospitals are exempt from the provision.
  • Hospitals have no clear formula to determine which patients qualify for the lower rates--essentially, financial aid--and how much of a discount is appropriate.
  • The Internal Revenue Service hasn't outlined a path to compliance for hospitals.
  • There's no guidance on advising uninsured patients of possible financial aid before they incur charges.

The administration contends hospitals shouldn't wait for final IRS rules to comply with the law and has begun compliance reviews, the AP reports.

Neither the American Hospital Association nor the Obama administration can say how many hospitals are providing financial aid as called for in the law, according to the article.

Some states have come up with their own fair-pricing guidance. Colorado's version of the law includes for-profit hospitals, the AP reports. California's law says uninsured patients making at or below 350 percent of the federal poverty line--$40,215 for an individual and $82,425 for a family of four--can't be charged more than Medicare rates.

Last week the Healthcare Financial Management Association revealed draft best-practices guidelines that promote transparency in communicating billing, financial counseling and payment requirements, and a fair path for resolving financial issues.

"The early, clear financial conversations described in these best practices will help give patients peace of mind and help providers receive appropriate payment--both key objectives for the healthcare system to function with fairness and compassion," said Nancy Davenport-Ennis, president and CEO of the National Patient Advocate Forum, which helped draft the guidelines.

Some hospitals are trying out their own systems. The Via Christi hospital system in Kansas, for example, has begun sending financial counselors to the bedside of uninsured or underinsured patients to begin discussing options including financial assistance or public benefits. Such counseling tends to improve collection rates.

For more:
- read the AP article

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