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

Posted on: Tuesday, 1 November 2005, 18:01 CST

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 office."

"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: http://www.providence.org/oregon.

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 http://www.providence.org/oregon.

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 litigation. -- 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) http://www.providence.org/oregon

Contact: Marcia Williams 503-215-4800 marcia.williams@providence.org

Providence Health System

CONTACT: Marcia Williams of Providence Health System, +1-503-215-4800,or marcia.williams@providence.org

Web site: http://www.providence.org/oregon

Source: PRNewswire

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