Written by Andrew R. Jones, Asheville Watchdog.
When HCA Healthcare purchased Mission Health in 2019 for $1.5 billion, it pledged to maintain the same level of charity care that had been in place before the sale.
Five years later, preliminary research out of Wake Forest University’s law school shows that the Nashville-based corporation has significantly decreased that care for lower-income patients.
An 18-page draft report of a forthcoming study authored by Mark A. Hall, a Wake Forest professor of law and public health, and obtained by Asheville Watchdog, found that “genuine charity care has diminished in systematic and extensive ways following the sale to HCA, with unfortunate effects on access to health care in western North Carolina.”
Hall said that because the report examines the commitments enforced by North Carolina Attorney General Josh Stein’s office when HCA bought Mission, Stein’s office may be interested in reviewing Mission’s current charity care practices.
HCA spokesperson Nancy Lindell downplayed the report’s findings.
“It is important to note that the author acknowledges this is a preliminary working draft, and it is based mostly on anecdotal information,” Lindell said. Most of the citations in the report refer to publicly available data and documents, many created by Mission and HCA themselves. “We appreciate the author reaching out to us now in search of data and information before compiling a final version later this year.”
Lindell also said that Mission Health “provides more free and discounted care than the previous program and our charity care and uninsured discount program is in compliance with the asset purchase agreement.”
The attorney general’s office expressed concern about the report’s findings.
“People in western North Carolina need to be able to access affordable health care,” attorney general spokesperson Nazneen Ahmed said in response to the report.
“The findings in this report about Mission’s charity care policy are deeply concerning, and our office is taking a closer look. We are particularly worried about the report’s claim that HCA is canceling procedures for patients who do not make an upfront out-of-pocket payment, even if those patients likely qualify for charity care.”
The IRS defines charity care as “free or discounted health services provided to persons who meet the organization’s criteria for financial assistance and are unable to pay for all or a portion of the services.”
Between 2018 and 2022, according to public reports authored by Mission, the hospital system reported a 72 percent drop in the proportion of its visits or days that were for charity care patients, the report shows.
Hall used documents, financial data, and interviews with nearly 50 professional sources to produce the report, which contends that HCA’s policy is more restrictive than nonprofit Mission’s and “normal charity care practice” in several ways:
- The new policy primarily determines charity care after a patient has received treatment, not prior to the care as it did before the HCA purchase.
- The policy requires patients to reapply for charity care every time they need treatment — in contrast to the old Mission system, which maintained a patient’s charity care eligibility for 6-12 months.
- The new policy requires low-income patients to pay a deposit before treatment, and the hospital has refused care to some who don’t and has even canceled some appointments.
- The new policy does not ensure charity care for all medically recommended services, as it did before the HCA purchase, only those that are “emergent, non-elective” services.
Lindell said Mission has provided more than $1.1 billion since 2019 in charity care, uninsured discounts, and other uncompensated care, which is defined as services provided by hospitals or other health care providers that don’t get reimbursed.
But Hall, a leading scholar on health care law, public policy, and bioethics, and the author or editor of twenty books, maintains in his report that HCA’s financial numbers don’t tell the whole story as they fail to include the 72 percent drop in time Mission has actually provided service covered by charity care.
“A quite plausible explanation for this discrepancy is that HCA has changed how Mission classifies uncompensated care,” the report states. “Rather than regarding many uncollected bills as bad debt, or regarding discounted prices as normal market pricing decisions, HCA appears to use its generous-sounding financial assistance policy to shift a good portion of these uncollected amounts over to the charitable side of its ledgers.”
Mission’s post-HCA charity care policy has frustrated staff and patients, according to Hall’s report.
“Even for potentially eligible patients who have received a bill from Mission, several professionals said they no longer advise patients to apply for charity care because the effort is too frustrating and futile.” according to the report. “One clinician tells their patients needing hospital care to just ‘cross your fingers and wait for Medicaid expansion,’ but in the meantime, ‘I’ll just manage the symptoms as best I can.’”
Because of the new policy, most charity care is through the emergency department, according to the report. But because the emergency room has so many issues — as The Watchdog has reported — people avoid it and wait.
“Due to wanting to avoid that ER experience if at all possible, physicians interviewed said that many people who need charity care simply wait until their condition worsens, to the point that it truly is an emergency,” the report states.
Several professionals at Mission have stopped trying to get patients approved for charity care as a result of the system’s constraints, according to the report.
“The primary aim of this research is not to determine HCA’s compliance with its purchase obligations,” Hall told The Watchdog. “However, based on what I’ve found, I do think the attorney general and others might have reason to take a closer look at whether, under HCA, Mission Hospital is properly administering its charity care policy.”
On Dec. 13, Stein, a Democratic gubernatorial candidate, sued HCA and Mission, alleging they had breached sections of the 2019 purchase agreement that stipulated the hospital continue providing emergency and trauma services and oncology services at the level before the sale.
Hall’s research also found that Mission board members who approved the $1.5 billion sale believed and said publicly that charity care would improve.
“During deliberations over the hospital’s sale, Mission’s Board became convinced that HCA’s charity care policy is more generous than what Mission then had in place,” the report states. “Mission’s executives also assured the public that HCA’s purchase would not diminish the hospital’s charity care commitment. Neither of these representations turned out to be accurate.”
Asheville Watchdog is a nonprofit news team producing stories that matter to Asheville and Buncombe County. Andrew R. Jones is a Watchdog investigative reporter. Email [email protected]. To show your support for this vital public service please visit avlwatchdog.org/donate.