Dr. Prem Reddy, owner of Prime Healthcare Services, is running around terrorizing 6,000 Southern California Kaiser Permanente members — sending them enormous hospital bills (via an aggressive collection agencies) and telling them to pay up, or ruin their credit. See the story here. One patient featured is being asked to pay $50,739.70 in full by June.
The company, with 9 hospitals Southern California, is demanding payment for emergency services that are currently under dispute with Kaiser. The patients are being told they must come up with the money to pay for their treatment (the portion that Kaiser is disputing and has not agreed to pay).
The tactic being used by the hospital chain is called “balance billing,” where patients are asked to pay the difference between what the hospital billed, and what the insurance company paid. The Schwarzenegger Administration has been working on regulations to ban this practice, and in a strongly worded notice releasing their proposed rules, accused providers — such as hospitals and physicians — who engage in this behavior of using “innocent enrollees” as “bargaining chips in an unfair provider billing pattern” that leads to “long-term harm o the enrollee’s health, safety and financial stability.”
Coincidentally — the Administration’s Department of Managed Health Care will hold a hearing on this very issue in Irvine on Wednesday, the heart of Orange County where three of Prime’s hospitals are located (and presumeably many of the recipients of these giant bills.)
(Relatedly, AB1203 by Mary Salas would ban this practice.)