Introduction California Sutter Health is revolutionizing the way that uninsured patients pay for their care. Their method is requiring uninsured patients to pay for services up front, which means that the patient pays for services before the services are rendered (Souza & McCarty, 2007)…
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This bill went into effect on January 1, 2007. This bill states that all acute, psychiatric and special hospitals must make patients aware of charity care, payment discounts, and government-sponsored health insurance. It also requires hospitals to standardize its billing and collection procedures (California Assembly Bill 774). Basically, this law requires transparency in hospital billing, as all hospitals must have detailed information about their charity policies, including who is eligible and what procedure must be taken for eligibility, and a written description of how the hospitals collect the debts. Also required is a written disclosure of the hospital billing practices and debt collection procedures for everybody (California Assembly Bill 774). Analysis The rationale for this particular change in the way California Sutter Health is doing business is rather simple – health care costs are spiraling out of control, and uninsured patients contribute much to the ever-burgeoning cost of health care to this country. As of 2005, some $45 billion worth of medical care is not being paid by uninsured patients (Families USA, 2005). What this means is that those with insurance pick up the tab for the people who cannot pay in the form of higher premiums. Another rationale for implementing this scheme is to encourage uninsured patients to get the care that they need, when they need it. Prior to the California Sutter Health scheme, many individuals did not visit the doctor when it was necessary, for fear that they would be hit with high medical bills (Families USA, 2005). This is because there was a great deal of uncertainty going in how much a certain procedure or visit would cost. What California Sutter Health did was show the patient, up front, what the costs would be, and this greatly empowers patients. The reason why this empowers patients is that they can see how much they will pay for something in advance. Then, they could either decide to get the procedure done, at that time, if they had the money for it, or they could decide to put the procedure off until they had the chance to save up the money that was needed. Therefore, everybody wins – the patient is allowed to know, up front, how much a procedure might cost, which helps the patient, and the hospital itself does not find itself stuck with uncollectible bills that makes the cost of health care higher for everybody. This scheme allowed CSH to reduced its account receivables by $78 million in just three months (Souza & McCarty, 2007). These are some of the benefits of the program. Which is not to say that the policy is without its costs. There were a few bugs that needed to be worked out before the policy was implemented. For instance, the patient financial services staff member, and the Central Business Office could not access real-time financial information and management could not generate detailed reports (Souza & McCarty, 2007). Moreover, there was the costs of properly training the patient financial services (PFS) staff, for they had to be trained in spotting errors and correcting them, such as when the occurrence code is incorrectly filed or accident information is missing from the claim (Souza & McCarty, 2007). Further training had to be done with registration employees, who were never accustomed to asking for money; they had to be tr
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