Trend: Finance firms want to finance patient debts

Last year, a scandal blew up when the public learned how Arkansas-based Hot Spring County Medical Center had handled the medical debt incurred by a truck-stop waiter. In an effort to boost its cash flow, the hospital sold its debt to a private finance company, CompleteCare. CompleteCare began tacking interest onto accounts, including that of the waiter, who had been making payments of $100 a month on his bills. When CompleteCare was done, the waiter's bill was quadrupled.

After a news article exposed the waiter's plight, the hospital and CompleteCare agreed to charge no interest to patients, a step that meant that it received less for the debt--but also was able to save face, to some degree. Still, many other hospital finance types see this as a lesson in how not to handle self-pay patients. Regardless, hospital financial executives should continue to expect aggressive pitches from finance companies like GE and Wachovia, which are eager to finance in similar situations. Many hospitals are turning financing companies away--scared by stories like this--but it seems likely finance companies will make some headway. What's not clear is whether hospitals will be able to do business with them in a way that supports their mission.

To learn more about this trend:
- read this St. Petersburg Times piece

Related Articles:
Firm pitches credit scoring for self-pay hospital patients. Article
Hospitals collecting patient bills up front. Article

Suggested Articles

Healthcare’s RCM processes are in dire need of a 21st-century update that delivers greater automation and real-time transparency.

Amazon's PillPack and Surescripts, owned by CVS Health and Express Scripts, are in a dispute over access to patient medication history data.

Presidential candidate Kamala Harris wants to get rid of the tax break drug companies get for direct-to-consumer advertising.