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Healthcare Finance Cases In Healthcare Finance Front Essay

Healthcare Finance Cases Cases in Healthcare Finance Front Street Hospital: Uninsured Charges and Collections

The underlying issue in this case deals with discriminatory medical pricing strategies. Although these types of pricing structure are common in other industries, such as the hotel industry, the implications on society exceed that of any other industry imaginable. For example, of all the bankruptcies filed in the United States, it is estimated that sixty percent of them are due medical bills (Tamkins, 2009). Furthermore, of medical related bankruptcies, over three quarters of these individuals' actually had health insurance. Therefore, one might wonder how the uninsured could even stand a chance of meeting their obligations; especially since they are billed at the highest rates possible.

Collective Bargaining

In the case, Jane is an uninsured patient and is billed for services amounting to nineteen thousand dollars. It also notes that it the local HMO would have insured Jane then the hospital bill would have been two thousand five hundred dollars; Medicaid would have paid five thousand and Medicare would of paid seven thousand eight hundred. So the question is posed, "Why do the uninsured get stuck with the whole bill." The answer to question is that insurance companies, public and private, have a considerably larger amount of bargaining power than that of any single individual. You can actually estimate the collective bargaining rates from the example provided. The HMO obviously has considerable power in negotiations, Medicaid ranks second, Medicare follows, and the individual (Jane) is dead last in regards to bargaining power.

Ethical Considerations

The most obvious breech of ethics that was presented in the case is the use of jail time or other questionable techniques by some hospitals to collect payments. Debtor's prisons were officially outlawed in the nineteenth century for their inhumanity and the effective return of such arrangements are quite frightening (Jones,...

Whether it is intended or not, the treatment that individuals' receive from many hospitals is that they are billed at the highest rates, in some cases more than six times that of what a HMO is billed at, and then when they fail to pay such outlandish bills they are pursued with, in many cases, unethical collection methods.
Recommendations

Not only do the billing and collection activities seem unethical for uninsured patients, they also appear to be counterproductive. The case notes that they collect less than five percent of the billings incurred by uninsured patients. That being the case, surely a better system could be developed to be more effective. For example in Jane's case, say that she was living pay check to pay check and couldn't afford any substantial payment toward her balance. If Jane was presented a bill that seemed so insurmountable to her situation, then she would likely not even try. On the contrary, if the bill was more reasonable, like that of the HMO's rate, then Jane may have more of an incentive to try to work out payment arrangements. Therefore, since the current billing system is so ineffective, there may be an opportunity to restructure the system so that it wouldn't leave uninsured patients hopeless in the end. It is reasonable to suspect that this would in turn significantly increase the hospital's collection rates and also improve the organizations' overall financial picture.

Works Cited

Jones, A. (2011, March 17). On the Rise of Debtor's Prison: 'The Scariest Thing That Ever Happened to Me'. Retrieved August 30, 2011, from The Wall Street Journal: http://blogs.wsj.com/law/2011/03/17/on-the-rise-of-debtors-prison-the-scariest-thing-that-ever-happened-to-me/

Tamkins, T. (2009, June 5). U.S. bankruptcies. Retrieved August 30, 2011, from CNN Health: http://articles.cnn.com/2009-06-05/health/bankruptcy.medical.bills_1_medical-bills-bankruptcies-health-insurance?_s=PM:HEALTH

Cases in Healthcare Finance Westwood Imaging Centers: Payment…

Sources used in this document:
Works Cited

Peterson, C., & Burton, R. (2007, September 17). U.S. Health Care Spending: Comparison with Other OECD Countries. Retrieved August 30, 2011, from CRS Report for Congress: http://assets.opencrs.com/rpts/RL34175_20070917.pdf

Schmidt, J. (2010, June 18). Who Has The Best Health Care? Retrieved August 30, 2011, from Informatica: http://blogs.informatica.com/perspectives/index.php/2010/06/18/who-has-the-best-health-care/
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