Union says Beth Israel overbills the state
Service Employees International Union says Beth Israel Deaconess Medical Center has higher emergency care costs than other major Boston hospitals, and makes greater use of a state pool to be reimbursed for free care it provides uninsured patients.
As a result, union local 1199 contends that Beth Israel Deaconess could cause a financial drain on the $610 million pool, which is an important part of the funding for the state's healthcare reform plan.
The allegations are contained in a report the union delivered Wednesday to State Senator Marc R. Pacheco , Democrat of Taunton, chairman of the Senate Committee on Post Audit and Oversight. "The committee and I will take these allegations very seriously," he said. "These are very serious concerns." He added that he hadn't yet had a chance to examine the union's complaints in detail.
"We looked at all the hospitals and Beth Israel just really stood out," said Mike Fadel, executive vice president of local 1199. "Their costs for emergency room patients stood out and their emergency bad debt overbilling to the pool really stood out."
Judy Glasser, spokeswoman for Beth Israel Deaconess, said, "We have followed all the rules and regulations regarding the uncompensated care pool and have never received any indication that there's anything out of order with what we've submitted to the state."
SEIU is the largest union in the United States with 1.8 million members, about 1 million of whom work in healthcare. Last summer, the union said it wanted to organize employees at Boston's large teaching hospitals, including Beth Israel Deaconess.
The union hasn't yet begun organizing efforts at Beth Israel Deaconess or other local hospitals, and union officials said the report sent to Pacheco isn't tied to recruiting efforts. They said its complaints grew out of the union's interest in Massachusetts healthcare reform.
An SEIU official sits on the board of the Commonwealth Health Insurance Connector Authority, which oversees the implementation of healthcare reform.
"This is a completely separate matter" from union organizing, said Fadel.
Celia Wcislo, SEIU's assistant division director, who sits on the Connector board, said this is a crucial time to examine the state's free care pool. Until now, insurance companies, hospitals, and the state have contributed annually to the fund. The money is distributed to hospitals to reimburse them for care given to patients without insurance who don't pay their medical bills. But the purpose and structure of the pool will change as healthcare reform is implemented and uninsured residents sign up for health plans. Going forward, it will be used primarily to subsidize healthcare insurance for previously uninsured low-income residents. The Division of Health Care Finance and Policy plans to institute new pool regulations by Oct 1.
Typically, hospitals try to collect payments from high-income patients and submit the rest of their emergency bad debt to the pool for reimbursement. SEIU found that Beth Israel Deaconess's billing for emergency bad debt increased at a much higher rate than other large hospitals, from about $1.65 million in 2001 to nearly $8.3 million in 2004. In that one year, the union contends, Beth Israel sought reimbursement for more of the bad debt than it was entitled to. The union called it "aggressive billing."
Separately, the union found Beth Israel Deaconess had the highest average emergency room costs from 2002 to 2005 of any major Boston hospital. The analysis compared the five most common emergency treatments provided to uninsured patients across Boston's teaching hospitals.
Glasser, the Beth Israel Deaconess spokeswoman, declined to comment on the specifics in the union report.
Union officials said if other hospitals copied Beth Israel Deaconess's aggressive billing of unpaid emergency care, the impact on the free care pool could be tens of millions of dollars -- enough to cripple the fund.
Mark Rukavina, director of the Access Project, a Boston health research and advocacy group, also declined to comment on the union's complaints. But he said SEIU's focus on the free care pool is warranted.
"We share their concerns about the vulnerability of the free care pool," said Rukavina. "Simply moving people into insurance policies doesn't eliminate the need for the free care pool as a safety net."
Sarah Iselin, commissioner of the Division of Health Care Finance and Policy, said a new reimbursement formula will ensure that hospitals get paid more uniform rates, potentially eliminating the union's allegation that Beth Israel Deaconess has higher emergency room charges than other Boston hospitals.
Jeffrey Krasner can be reached at krasner@globe.com. 