At the behest of State Treasurer Dale Folwell, a bipartisan healthcare consumer protection bill was introduced in the State House.
House bill 1039, filed Tuesday, is entitled Medical Debt De-Weaponization Act. Main sponsors are Democrats Howard Hunter from Hertford and Billy Richardson from Cumberland and Republicans Ed Goodwin from Chowan and Bobby Henig from Currituck.
The bill must be approved by the House Banking, Health and Rules and Operations committees before it goes to the chamber for a vote.
There’s also an intriguing mix of 39 Conservative and Progressive co-sponsors, including MPs Pricey Harrison, D-Guilford, and MPs Lee Zachary and Jeff Zenger, both R-Forsyth.
“I’ve been very disturbed by all the stories I’ve read and heard about the overwhelming burden of medical debt,” Harrison said. “She’s responsible for two-thirds of bankruptcies, including my constituents.”
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“Obviously it would help some if we passed the Medicaid expansion, but this proposal appears to offer some protection against abusive pricing,” Harrison said.
intention of the bill
According to the bill and a statement by Folwell, the purpose of the bill is “to create a family-friendly, anti-poverty and consumer-protecting law that sets parameters for the delivery of charitable care and restricts the ability of large medical facilities to charge unreasonable interest rates and unfair interest rates.” Use debt collection tactics.”
Folwell’s primary interest in applying for HB1039 is its oversight agency for the state health plan, which has more than 727,000 participants, including current and retired state employees, teachers and legislators. It is North Carolina’s largest purchaser of medical and pharmaceutical services.
“With inflation at a 40-year high and North Carolina suffering from severe anxiety, families need protection from weaponizing medical debt,” Folwell said. “One way to do this is to ensure that major medical providers are transparent about the availability of financial aid and that an appropriate level of charitable care is available to working families in need.
“A life-saving procedure shouldn’t cost your life savings.”
The NC Hospital Association said Friday that it is “still digesting and analyzing this bill and has no position on it.”
“A first high-level assessment is that federal law already addresses several requirements in the bill and the North Carolina General Assembly passed legislation as early as 2013 that addresses many of the state-specific issues related to fair billing and collections practices.”
The NCHA said hospital spending on charities and investing in charities is “transparent and accountable.”
“North Carolina’s nonprofit hospitals submit annual audits to the state and federal tax authorities, which determine that the hospitals are meeting their tax obligations.
“Failure to comply can result in the revocation of a hospital’s tax-exempt status, which is unprecedented in North Carolina.”
HB1039 represents a regulatory response to an analysis of North Carolina’s for-profit and not-for-profit hospitals released in October by the Johns Hopkins Bloomberg School of Public Health. This analysis was requested by Folwell and the SHP, over which the Treasurer has oversight authority.
The analysis found that many of these hospitals — including the three largest in the triad — are not fully performing their charitable mission. A video link to the presentation can be found below https://www.youtube.com/watch?v=pL1j4-n3ea8.
The report found that North Carolina’s largest nonprofit hospital systems raked in more than an estimated $1.8 billion in tax breaks in 2019-2020. In most of these schemes, spending on charitable care did not exceed 60% of the value of their tax breaks, according to researchers.
For the major healthcare systems that serve the triad, the Johns Hopkins report lists the projected annual value of tax exemptions versus the systems’ disclosed charity funding.
It was reported that Atrium Health received $440.1 million in state tax exemptions while giving $260.1 million to charity.
It was reported that Novant Health received $324.1 million in state tax exemptions while giving $179.1 million to charity.
It was reported that Wake Forest Baptist Medical Center, now an Atrium subsidiary, received $210.3 million in state tax exemptions while giving $54.8 million to charity.
Medical Guilt Laws
The bill is similar to legislation in other states’ consumer protection laws aimed at protecting families from the effects of medical debt on Americans.
Another study conducted by Rice University’s Baker Institute of Public Policy, the National Academy for State Health Policy and the SHP found that some of North Carolina’s nonprofit hospitals in 2019 were poor patients who applied for free or discounted charity care should have qualified, $149.2 million billed the hospitals’ own policies.
In addition, up to 28.7% of uncollectible hospital debts were billed to impoverished patients who were likely eligible for charity care.
HB1039 would require healthcare facilities to develop a medical debt reduction policy that would build on an existing framework of financial assistance plans under the federal Affordable Care Act.
Folwell said his quest for consumer bill protection for medical bills was spurred by the lack of progress in solving medical debt problems over the past four decades.
Zachary said he chose to co-sponsor the law because it has the potential to “curb the predatory lending and collection practices of some medical providers/lenders.”
“According to some people who work with Treasurer Folwell’s office, consumer debt, whether it is for necessities or consumer debt, is all subject to the same law.
“This bill would create a new medical/veterinary debt law for necessary procedures,” Zachary said. “That’s something Democrats and Republicans can both vote yes to.”
Review by the Attorney General
In January, Atrium Wake Forest Baptist, Cone and Novant were found to be in full compliance with federal regulations to improve price transparency for patients, according to NC prosecutors.
However, the bureau listed eight community or specialty hospitals in the 14-county triad and Northwest NC region that were not fully compliant at the time of the report. The federal centers for Medicare and Medicaid Services on January 1 introduced a hospital price transparency initiative.
Every hospital “must provide clear, accessible pricing information online about the items and services they offer,” CMS said. Hospitals can face civil fines for non-compliance.
The Attorney General‘s review found 122 hospitals statewide to be in full compliance with CMS regulations.
In the meantime, 16 hospitals do not meet the requirement to submit a machine-readable list of services and prices. Hospitals listed in this category are Alleghany, Ashe, Hugh Chatham in Elkin, Northern in Mount Airy and Randolph in Asheboro.
One hospital – Holly Hill – does not meet the requirement to provide a consumer-friendly shopping list.
Eight hospitals fail both, including Kindred in Greensboro, LifeBright in Stokes County, and Select Specialty in Greensboro.
Some hospitals in the non-compliant categories told the attorney general’s office that they were in the process of updating their tools to comply.
In June, Attorney General Josh Stein wrote to North Carolina hospitals “to encourage them to comply with regulations to better empower patients with the information they need to make informed decisions about their healthcare.”
“When hospitals are transparent about their prices, patients can shop around and keep healthcare costs in check,” Stein said.