By Scott Robertson
Ballad Health announced Monday a sweeping set of discounts aimed at improving the ability of lower to middle income patients’ to afford healthcare costs, even if they are uninsured or have high insurance deductibles.
Ballad issued a press release saying it will increase the discount for its services to uninsured patients from 77 percent to 85 percent. For those patients who are insured, but have relatively low family incomes, Ballad will implement a sliding scale of discounts. For any insured patient making 225 percent of the federal poverty level or less, the hospital system will cover the entire deductible cost, so the patient will pay nothing. The scale slides so a patient making 450 percent of the federal poverty level will receive a 10 percent discount.
Ballad also announced it will implement a new artificial intelligence platform to streamline the process of determining eligibility so patients will be freed from bureaucratic paperwork.
At a news conference an hour after the release was issued, Alan Levine, executive chairman, president and chief executive officer of Ballad Health, explained the details of the plan and why the system had chosen to implement it.
Levine said the discounts given to insured patients are an attempt to respond to the dramatic rise in the number of patients with high-deductible plans. “What we don’t want is for people to not seek care when they need it because they’re afraid of the out-of-pocket cost,” Levine said. So, under the new plan, “if you are a family of four and you make $57,800 a year, you’re eligible to have all your healthcare costs written off.”
When asked whether the new policies would affect cases of individuals who Ballad is currently suing to recoup unpaid bills, Levine said it would. He placed blame for the majority of the increase in unpaid bills over the last several years on the insurance industry.
“Our approach to how we collect has never changed,” Levine said. “What has changed is over the last six or seven years these deductibles have skyrocketed and the shift of liability to patients has gone way up. And so that’s why you’re seeing (hospitals suing patients over unpaid bills) all over the country. I think this crept up on hospitals in a way they didn’t quite understand. I know I didn’t realize this until a couple years ago, but the fastest growing part of our uncollectible revenue is not patients who are uninsured. It’s patients who have insurance but who can’t pay the deductible.”
The insurance conundrum
In the press release announcing the discounts, Ballad said, “According to a Kaiser Family Foundation survey, four in 10 U.S. workers had difficulty paying a medical bill or insurance premium in the previous 12 months, and nearly half of those workers (are) in a plan with at least a $3,000 individual deductible or a $5,000 family deductible reported problems affording healthcare.”
“The steps being announced by Ballad Health today are intended to be helpful to the people in our region, but they are in no way a long-term solution to the affordability crisis in healthcare,” Levine said in the release. “The ongoing shifting of costs by insurers to patients is unfair, and it is certainly not reasonable to expect patients and rural and non-urban hospitals to shoulder the burden of the cost.”
“So, the insurance company premiums have gone up,” Levine said at the news conference. “The deductibles have gone way up. But the patients, the benefit they’re receiving has actually gone down. And a long-term solution to this isn’t just to shift those costs to the hospitals. Rural hospitals won’t survive.”
Most rural hospitals simply won’t be able to afford to increase their discounts the way Ballad is. “It’s estimated that 450 hospitals in the country are at financial risk,” Levine said. “If every hospital in the country is going to now take responsibility for the deductibles. You’re going to have a lot of those hospitals that are going to accelerate their demise.
“I don’t know what the long term solution is for the country and Ballad isn’t really in a position to tell everybody what they should do. What we’re doing here is trying to incrementally make it better for the people that live here in the hopes that we can work with our colleagues in the insurance industry and in government to try to come up with a longer term solution.
“We’ve had to sort of step back and say, how do we help those people while at the same time advocate for a different approach to this? We’re going to do what we can to help, but we’re imploring the insurance industry and our federal lawmakers to sort of step in and realize that this is not what the purpose of insurance was. Insurance is intended that when you pay a premium you have a reasonable out of pocket participation, but when you walk into an ER with a heart attack or you are brought to an ER with a heart attack, you expect that you’re not going to be stuck with a $5,000 bill. And I don’t think that’s an unreasonable expectation for patients to have.”
In addition to the discounts, the press release said Ballad would implement an artificial intelligence platform designed to drastically cut the bureaucratic red tape patients are currently forced to cut through in order to receive discounted care. “After April 1 you will no longer have to apply to receive the benefit of charity,” Levine said.
Beginning April 1, Ballad Health will be implementing “presumptive eligibility” for patients who could be eligible for free care or discounts under Ballad Health’s expanded charity policy. Using publicly available data and newly acquired analytic tools, Ballad Health will be capable of determining if a patient is likely to be eligible for free care or for discounts. This, the system said in its news release, will reduce barriers to receiving charity care (such as producing hard-to-find paperwork), therefore reducing the number of patient bills labeled as bad debt or referred for collections.
In many cases, the release said, the discount will be applied to patients who aren’t even aware they are eligible.
“The changes announced by Ballad Health today to expand discounts and access to charity care are not required by the COPA, nor have they been imposed by either state,” Levine said. “These changes are a result of Ballad Health’s board of directors and leadership listening to the concerns of our patients, recognizing the hardship that has been imposed by insurers shifting higher costs to patients through unaffordable premiums and deductibles, and they are intended to be responsive to those concerns.
“When people buy insurance, they deserve peace of mind knowing they can access the coverage when they need it. It is terribly unfair to families who find out, at their most vulnerable time, that they cannot access the coverage they thought they had,” Levine continued. “Hospital charity programs cannot be expected to solve this problem alone. Working with health care providers, insurance companies and federal policymakers, we have to come up with a more sustainable solution. A rural health system with only 25 percent commercial payer mix cannot survive if the expectation is that insurance, pharmaceutical and other medical companies can shift cost to patients, and then hospitals are forced to pay for these costs by writing off necessary care that patients can’t be expected to afford.”
Asked whether the timing of the announcement had anything to do with Tuesday’s scheduled public hearing regarding the Tennessee COPA, Levine denied any connection. “You make a move like this for the right reason and hopefully something good results from it…that’s what’s happening.”