Providence Health System Reaches Proposed Settlement in Lawsuit Challenging Its Charity Care Policies

Nov 01, 2005, 00:00 ET from Providence Health System

    PORTLAND, Ore., Nov. 1 /PRNewswire/ -- Providence Health System today
 announced a proposed settlement in a lawsuit filed last December that
 questioned Providence's charity care practices and billing policies.
     The agreement reached with plaintiffs in the case is the one of the first
 settlements among scores of similar lawsuits filed around the country
 challenging charity care standards and billing and collections practices
 affecting uninsured patients at dozens of large nonprofit hospitals.
     "Providing high-quality care to the most vulnerable members of the
 communities we serve is at the heart of everything Providence does," said Russ
 Danielson, chief executive of Providence Health System in Oregon.  "It's the
 reason we were founded by the Sisters of Providence 150 years ago. While we
 disagree with the allegations made in the lawsuit, settling it made sense to
 avoid the tremendous costs associated with a trial and allow us to focus on
 our mission. The content of the settlement affirms our efforts over the past
 several years to make our charity care and financial assistance policies
 clearer and more consistent."
     Under terms of the proposed settlement, Providence's current charity care
 policies will be applied retroactively to supplement the charity care
 previously made available to uninsured patients who obtained care at
 Providence hospitals in Oregon over the last three years.
     Providence's current charity care policies provide financial assistance
 for uninsured patients with limited assets and incomes at less than 400
 percent of the federal poverty level. Patients with limited assets earning 200
 percent or less of the federal poverty level pay nothing.
     Providence currently also offers to discount billings for all uninsured
 patients, regardless of their income, to the same "preferred provider" rates
 paid by most of its insured patients.
     Providence's charity care policies adjust uninsured patients' personal
 responsibility for their hospital bills based on their individual financial
 circumstances, assets and income.
     Providence also has agreed to continue to make information about how to
 access its financial assistance programs available to all patients, and will
 continue to work with patients individually to offer financial help that takes
 into account the individual patient's ability to pay. Under some circumstances
 Providence also will forgo interest on debts.
     While Providence financial assistance and charity care policies are
 continually reviewed and refined, Providence Health System has a nearly
 150-year heritage of providing care to all in need, regardless of income.
     Last year, Providence Health System in Oregon provided financial
 assistance to an average of about 250 patients a day, contributing more than
 $34 million in charity care costs and writing off more than $62 million in
 charges. For 2005, we are on track to provide $50 million in charity care
 costs -- a 43 percent increase.
     "Providence Health System is a ministry committed to the highest quality
 health care, delivered with respect and compassion for each individual by more
 than 33,000 Providence people who share a common mission and values," said
 Danielson. "Our financial assistance policies ensure that we extend the
 compassion people associate with Providence from the bedside to the billing
     "This settlement allows us to continue focusing on caring for the most
 vulnerable in our communities," said Danielson, "but such settlements do not
 resolve the fundamental problems faced by the millions of families who are
 uninsured in this country. Only a concerted effort by government leaders and
 health care providers can assure that all our citizens have adequate access to
 health care services."
     For more information about the proposed settlement or Providence's
 financial assistance program, call:  503-215-5282 (Portland area) or
 1-866-747-2455 (outside of Portland area), or visit:
     Providence Health System in Oregon, ranked as the fourth most integrated
 health care system in the nation, offers a comprehensive array of health and
 education services through its seven hospitals, medical clinics, health plans,
 long-term care facilities and home health services. With more than 14,000
 employees, Providence is the state's second-largest private employer. Visit
                                   FACT SHEET
     -- Providence Health System in Oregon leads the way in providing charity
        care to people in need.
        - Each day, Providence in Oregon provides financial assistance to more
          than 250 patients.
        - Providence in Oregon is on track to provide $50 million in charity
          care costs in 2005 (a 43 percent increase from 2004).
        - In doing this, Providence continues its 150-year mission of caring
          for the poor and vulnerable.
     -- Providence in Oregon has reached a proposed settlement in the so-called
        Scruggs lawsuit.
        - This agreement is one of the first settlements among scores of
          similar lawsuits that Richard Scruggs, in conjunction with local
          attorneys, has filed against dozens of large nonprofit hospitals
          across the country. The lawsuits question hospital charity care and
          billing practices.
     -- The proposed settlement is retroactive to December 2001.
        - It would apply Providence's current charity care policies
          retroactively for uninsured low-income patients who received care
          through Providence hospitals since December 2001. This will
          supplement the charity care Providence already provides.
        - This means uninsured patients with limited assets and incomes lower
          than 400 percent of the federal poverty level receive help. Similar
          patients, with incomes that are at 200 percent (or less) of the
          federal poverty level, pay nothing.
     -- Providence believes settling this lawsuit is consistent with our
        leadership role and consistent with our values of stewardship and
        compassion for those in need.
        - Given our values, we feel it was more important to use our resources
          for the good of our communities instead of expending them in costly
     -- We recognize that settlements or lawsuits do not solve the fundamental
        crisis of millions of people who are uninsured.
        - We will continue to work for solutions to the crisis of the uninsured
          in America, but look for public policy leaders and other health care
          organizations to join us in this ongoing endeavor.
     For more information about the proposed settlement, contact us at:
 503-215-5282 (in Portland area) or 1-866-747-2455 (outside Portland area)
     Contact:   Marcia Williams

SOURCE Providence Health System