Should hospitals guarantee poverty care?

While the Mississippi Hospital Association protests that the idea would be disastrous for its members, attorney Richard Scruggs said a lawsuit settlement being negotiated with North Mississippi Medical Center involving free and reduced medical care could become a national model for the level of service hospitals should provide. Mr. Scruggs suggested hospitals provide free care to anyone with income up to 200% of the federal poverty level.

Applying a sliding-fee scale

He also said hospitals should apply a sliding payment scale discounted off the Medicare payment rate for those between 200% and 400% of poverty. For a family of three, the poverty level is $15,670, making the 200% level $31,340 and the 400% level $62,680. According to state officials, half of Mississippi’s 1 million households come under the 200% level.

The Medical Center only would say that it was looking at Mr. Scruggs’ proposal to make sure that it can afford it and that it doesn’t have any unintended consequences. Former Mississippi attorney general Mike Moore, who represents the hospital, said the best deal "would be one where the hospital can continue its mission and the uninsured are treated fairly."

While Mr. Scruggs and other attorneys have sued some 450 hospitals and the American Hospital Association claiming that the facilities charge the uninsured "sticker prices" while giving discounts to those covered by private or government insurance programs, North Mississippi Medical Center is the only one to consider a settlement rather than go to trial.

Could affect 50% of patients

Mississippi Hospital Association president Sam Cameron said one hospital in his state looked at Mr. Scruggs’ proposal and determined that it would cover 50% of the hospital’s patient population. He said that if hospitals adopted such a model, small employers would drop health insurance for their employees, and some employees would drop their coverage so they could obtain free medical care. Mr. Scruggs said his proposed settlement also calls on hospitals to use a kinder, gentler approach to collecting fees from the uninsured. "They’re entitled to sue and garnish, but not get liens on houses," he told the Jackson, MS, Clarion-Ledger.

Mr. Cameron told the newspaper that government regulations require hospitals to be uniform in their approach to all patients, permitting hospitals to file suit when necessary.

Although Mr. Scruggs said many nonprofit hospitals don’t provide enough charity care, sometimes amassing large cash reserves amounting to hundreds of millions of dollars, Mr. Cameron contended that the American Hospital Association had determined the nation’s 5,000 hospitals provided more than $22 billion in uncompensated care last year.

"Nonprofit hospitals have more cash than all the states combined, yet they’re not providing service that left them free of taxation," Mr. Scruggs said.