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"Insurers, not Hospitals, should collect Deductibles" by Michael Sack

In a few short days the state’s landmark health reform law will reach another milestone - the requirement that each individual have health insurance. The Connector Authority, together with the health insurers, has developed 35 different insurance products to meet an individual’s needs. All of these plans are similar in that they offer coverage with low premiums but relatively high co-payments and deductibles.

Who is responsible for explaining and collecting the co-payments and deductibles? If you think it’s the insurers you are wrong. As it stands now, it’s mainly up to your local hospital to explain the plan’s coverage and to collect “out-of-pocket” expenses - an often difficult, costly and time-consuming effort.

I think that should change and so does state Senator Richard Moore, Senate Chair of the Joint Committee on Health Care Financing, who introduced a bill - SB690 - that shifts responsibility for collecting co-payments and deductibles to insurers who design the plans.

The bill takes on heightened urgency with the new “high deductible” plans that are being aggressively marketed across the state and the growing trend of health plans to shift more of the financial burden for care on to its members.

Hospitals throughout Massachusetts spend a great deal of human and financial resources in trying to obtain payment for the services they provide. Unfortunately, even after significant investment of time and personnel, the co-payments and deductibles can be the hardest money to collect. Each year, the state’s 69 acute care hospitals provide tens of millions of dollars in patient care that cannot be recovered and end up as “bad debt,” which places additional challenges to their mission of building healthier communities.

Massachusetts’ hospitals are committed to providing services to all patients regardless of their ability to pay. However, without some shift of responsibility, we will have to invest even more administrative dollars to offset the increasing complexity and variety of health insurance products; this additional cost will pose significant financial risks to hospitals.

In Rhode Island, the House of Representatives addressed a similar issue by passing a compromise bill that spreads responsibility among hospitals and insurers. The approach echoes the principle of “shared responsibility” that is the underpinning of the Massachusetts Health Reform Law.

I believe that SB690 is a step in the right direction and should be given serious consideration by the Senate and ultimately the entire Legislature.

Let’s let hospitals do what they do best - provide care to the sick and injured - and insurers do what they do best - handle the financial responsibilities of providing that care.

Michael V. Sack is the President and CEO of Hallmark Health

This program aired on June 26, 2007. The audio for this program is not available.

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