Uninsured Hospital Care: Consumer and Financial Protections

FACT SHEET:
SB1394/Ortiz

Uninsured Hospital Care: Consumer and Financial Protections

Problem: Over 20% of California residents lack health care coverage. Yet hospitals report that they spend, on average, less than 1% of their expenses providing care to uninsured families without charge, and many hospitals report providing no such "charity care."

As such, these 6.2 million uninsured people-over 80% in working families-in our state face both a health problem and a financial problem.

· Uninsured families who go to the hospital for needed care are often charged exorbitant rates, often much higher than the rate for insured patients.

· Large medical bills are often sent to collection agencies, ruining an uninsured family's financial future. A recent Harvard study indicates that medical bills and health issues are a leading factor in half of all personal bankruptcies.

· Uninsured families are often unaware of the financial options that exist, from public insurance programs to the hospital's own "charity care" policy. Such "charity care" policies have no uniform definitions, set standards, or requirements to be made public, causing significant confusion among the uninsured.

· Fearful of the financial repercussions and unaware of their rights and options, uninsured families all too often avoid getting the care they need, resulting in devastating health impacts. A recent Urban Institute report showed that uninsured adults in California are far less likely to go to the emergency room (12.1% had at least one visit in 1999) than those on private insurance (20.8%) or public programs (32.9%).

Legislation: The bill sets consumer and financial standards so that uninsured families stand a better chance of getting the hospital care they need without facing financial ruin.

· The bill requires that uninsured patients are given notice about their rights and financial options when seeking care at a California hospital.

· The bill sets up simple, common-sense systems to check to see if the patient qualifies for help, from the hospital's charity care policy, public insurance programs, county funds, or any other mechanisms that could cover the cost of care.

· While allowing hospitals to set their own charity care policy and not imposing any required amount, the bill provides uniform definitions and reporting of "charity care," removing much of the confusion for consumers and regulators.

· For patients that are not eligible for such coverage, hospitals will be required to charge a reasonable rate to the uninsured, rather than the highest possible rate that they may be charged now.

· Patients would be given the opportunity to negotiate payments and payment plans before their bill is sent to collections, which can ruin a family's credit report and their financial future.

Sponsors: Health Access California Contact: Beth Capell, (916) 497-0760.
Consumers Union Contact: Earl Lui, (415) 431-6747.

View Files Sorted By Office: Consumers Union OPI, New York - Washington DC Office
West Coast Regional Office - Southwest Regional Office - Consumer Policy Institute.

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