Kaisernetwork.org – Jan. 27, 2009.
Summaries of recent news about actions taken by attorneys general in Massachusetts and Minnesota appear in this article… Click title to read more…
- Massachusetts: Attorney General Martha Coakley (D) has launched an investigation into whether insurer Blue Cross and Blue Shield of Massachusetts and health care provider Partners HealthCare illegally conspired since 2000 to increase the costs of health insurance statewide, the Boston Globe reports. Over the last nine years, BCBS has increased the rate it pays for care by Partners doctors and hospitals by 75%, which is “dramatically more” than increases given to most other hospitals in the state, according to the Globe. Coakley’s investigation comes after a recent Globe report found that Partners and BCBS officials made an undocumented, private agreement in 2000 under which BCBS would give Partners significant payment increases if in turn they required its competitors to pay similar increases. The agreement “usher[ed] in a decade of rapidly escalating health care costs,” as the insurers increased premiums to offset the higher payments to Partners, the Globe reports. Partners and BCBS contend that the higher payments were needed to offset the growing costs of new medical technology and providing care. The companies deny that they have done anything illegal. Coakley has requested that both companies submit a detailed account of their contract negotiation for the last several years (Allen/Farragher, Boston Globe, 1/23).
- Minnesota: Minnesota Attorney General Lori Swanson (D) on Thursday filed a lawsuit on behalf of thousands of residents alleging that Allina Hospitals and Clinics unlawfully charged patients’ high interest rates on unpaid medical bills, the Minneapolis Star Tribune reports. According to the lawsuit, Allina through its MedCredit Financial Service charges 18% interest on debts of up to $4,999 and 12% interest on debts from $5,000 to $9,999; however, state law caps medical debt interest rates at 8%, Swanson said. Allina maintains that the interest rates were “fully consistent with Minnesota law” because the company is offering “open-ended credit,” which by law can charge up to 18% interest. Swanson says MedCredit does not constitute as “open-ended credit” because it does not extend credit, but rather services, and collects debt for Allina. The hospital system says that MedCredit is “open-ended credit” because patients can use the program for subsequent care. Allina has decided to reduce its interest rate to the maximum of 8% beginning Feb. 1. In the lawsuit, Swanson is requesting that MedCredit refund patients who were charged at higher rates and is seeking civil penalties of up to $25,000 per violation (Yee, Minneapolis Star Tribune, 1/22).
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