June 9, 2023

Allina Health Allegedly Denied Care To Patients With Medical Debt

Allina Health Allegedly Denied Care To Patients With Medical Debt

Source:  Allina Health Facebook

Allina Health System in Minneapolis is reportedly denying care to patients who have medical debt according to the New York Times investigation. 

A controversial article in the New York Times recounts an instance in which a pediatric nurse practitioner treated a child for scabies. The child’s mother and two siblings were sharing one bed in a single room they rented. To prevent the scabies from spreading, the provider wanted to treat the family. However, she was only able to write a prescription for two of the children. The third's account was frozen due to overdue bills.

The Times investigation revealed that some have been told they must clear their debts in order to get treatment. The policy has impacted pediatric patients as well as those with chronic conditions like cancer, diabetes, and depression.

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Details of the Allina Health Investigation

The New York Times discovered that although Allina provides care to everyone in its emergency rooms, other outpatient services can be stopped if patients accumulate too much debt. In some cases, patients are not allowed to return unless their debt is paid in full, according to internal records and conversations with doctors, nurses, patients, and others at the health system. 

Allina allegedly has a policy that requires employees to cancel appointments for patients with at least $4,500 in unpaid debt. They also lock patients' electronic medical records so that they cannot schedule future appointments. The article mentions patients who were unable to obtain paperwork from previous visits, such as vaccination records for school or daycare. Conny Bergerson, a hospital spokeswoman for Allina Health, told the Times that patients are only shut down if they have at least $1,500 in delinquent debt on three separate occasions. 

If a patient is unable to pay their debt, the health system says it contacts them by phone and mail with information about financial assistance programs. According to the spokesperson, cutting off patients is "rare".  “Allina Health’s goal is, and will always be, to have zero patients go without services for financial reasons,” Bergerson said.

The policy of withholding care reportedly began in 2006. Allina Health reportedly halted the policy during the COVID-19 outbreak in March 2020, but began reintroducing it in April 2021.

Source: Facebook

Outrage Over Allina’s Practices

Many readers were upset by the non-profit health network's habit of withholding care to those in most need. “These are the poorest patients who have the most severe medical problems,” Matt Hoffman, a primary care physician from an Allina facility in Minnesota told the Times. “These are the patients that need our care the most.” 

Nonprofit hospitals like Allina receive massive tax benefits in exchange for serving the poorest individuals in their communities. Allina Health System operates more than 100 hospitals and clinics in Minnesota and Wisconsin, and it generates $4 billion in revenue annually. According to data cited in the Times article, Allina avoided around $266 million in taxes in 2020 as a result of its nonprofit status.

According to one study using CMS hospital cost data, the system spent less than $1 of every $100 in total spending on financial aid from 2018 to 2021. Compare this to 2018 data showing that nonprofit hospitals spent $2.3 out of every $100 in total expenses on financial aid, while government hospitals spent $4.1, and for-profit hospitals spent $3.8.

In 2020, there were around 109,000 persons with medical debt on their credit records in Minnesota, where the majority of Allina hospitals are located. Overall, the state's entire medical debt is $148 million. In theory, Allina Health System could have wiped out all of the state's medical debt if they had covered their fair share deficit (the amount of their tax exemption) by providing free care, according to Judith Garber, Senior Policy Analyst at the Lown Institute. Notably, Allina’s president received $3.5 million in 2021, according to publicly reported data. 

Source: Facebook

The Times article said that Allina's policy informs personnel on how to deal with patients who owe money. It instructs staff to "cancel any future appointments the patient has scheduled at any clinic." It does provide a few options for patients to continue seeing doctors despite outstanding costs, such as applying for a loan through the hospital or declaring bankruptcy.

All Minnesota non-profit hospitals are bound by the state’s Hospital Agreement which provides safeguards to patients against fraudulent or aggressive debt collection practices. 

Following the NYT article, Minnesota Attorney General Keith Ellison told local news station KARE 11 that he is looking into allegations of aggressive billing methods and refusal of care at Allina Health clinics. "Denying patients needed care on the basis of medical debt harms every Minnesotan, whether or not they are Allina patients," Ellison said. "I encourage anyone with knowledge of or affected by the practices raised in the article to contact my office so we can determine the scope of the problem and whether any laws or agreements have been broken."

Billing Practices in Other Health Systems

According to KFF News, Allina is not the only hospital system to refuse care for unpaid medical debt. A recent examination of billing practices at 528 hospitals nationwide revealed these findings. 

  • One in every five people with outstanding debt are denied non-emergency care.

  • More than two-thirds of hospitals sue patients for unpaid bills or seek other legal action against them, such as wage garnishment or property liens.

  • Over two-thirds of hospitals report patients to credit reporting agencies, affecting patients' credit ratings and ability to rent an apartment, buy a car, or find work.

  • Around one-fourth of hospitals sell patients' debts to debt collectors, who harass patients for years over collection accounts.

Of those sampled, 55 hospitals stated within their written policies that they do allow non-emergency treatment denials for patients with medical debt. Many of the hospitals investigated in the KFF report for care denials are from the major nonprofit systems in the US, including the following:

  • Ascension

  • Indiana University Health

  • Cedars-Sinai Medical Center

  • Mayo Clinic

  • Trinity Health

Currently, there are no regulations about refusing non-emergent care. As a result, the government does not monitor how frequently hospitals refuse to provide those services.

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