Here & Now

Wisconsinites Owe Billions in Unpaid Medical Bills

Frederica Freyberg:

Now to health news and a bad diagnosis regarding unpaid medical bills. The Wisconsin Hospital Association reports a 7.6% increase in 2018 in unpaid patient bills, also known as uncompensated care. The tab totals a debt of $1.2 billion owed to over 150 Wisconsin hospitals. These are expenses either patients refuse to pay or simply cannot afford. The total also includes charity care provided by hospitals at no charge to certain qualifying patients. We work through this development with Bobby Peterson, the director of ABC for Health, a non-profit law firm that helps people find affordable healthcare coverage. Thank you for being here.

Bobby Peterson:

Glad to be here.

Frederica Freyberg:

In your mind the overriding cause of this are efforts to undo the Affordable Care Act at both the national and state level.

Bobby Peterson:

Right, I think when you sow confusion, you get people more tentative applying for programs. They think they don’t exist. A lot of marketplace confusion out there. So it leads to people not getting the coverage that they need. When they get care, oftentimes they’re unable to pay for it.

Frederica Freyberg:

So included in this idea you say is that in Wisconsin, the Medicaid or BadgerCare program you describe the eligibility process as a corn maze. So does the difficulty in navigating the system, that corn maze, leave people just going uncovered or what are the implications that?

Bobby Peterson:

Sometimes. Right. Sometimes. I mean when you think about it, there are at least 16 different eligibility features between Medicaid and BadgerCare and then the marketplace and which way do you go? Parents are directed towards the marketplace. Children are directed towards BadgerCare+. Families might have split coverage, depends on their income. How is it attributed to their children? So it does, it creates a corn maze eligibility. You’re feeling your way through the process, trying to gain eligibility. Sometimes you miss out. Sometimes you give up. And when you do, and you have medical concerns and medical issues, it can often go unpaid.

Frederica Freyberg:

You also cite junk insurance. How does that contribute to people not paying for medical care?

Bobby Peterson:

Because the insurance isn’t paying what it should be. I mean if you think about comprehensive health insurance that covers most of your care needs. You know, insurance is changing so there is more co-payments and deductibles but we’re talking about specific solutions, policies that are temporary policies, association health plans. They’re really not as robust as what we see within the Affordable Care Act or typical private health insurance.

Frederica Freyberg:

Were these junk plans heretofore like during when ACA was in full force they didn’t exist?

Bobby Peterson:

They came — I mean the Trump administration has put forward rules that have made it easier for those plans to grow. Prior to the Trump administration, they were more specifically excluded.

Frederica Freyberg:

Would that be the case, too, with the kind of corn maze of the Medicaid program in Wisconsin? Did it have to do with tinkering around the edges?

Bobby Peterson:

Well, I think Wisconsin didn’t expand Medicaid so when we tinkered around the edges and said we’re could expand up to 100% for adults and expand up to 306% for some children, that creates different eligibility pathways so which way do you go out on the corn maze? For my kids, for myself, my income is fluctuating. I might be on or I might be off.

Frederica Freyberg:

Really complicated.

Bobby Peterson:

Seasonal employment or sales, farming income that could drop suddenly because of fuel costs or other things. There are a lot of variables out there. It’s hard for people to stay on top of.

Frederica Freyberg:

You also talk about surprise medical bills. What are those?

Bobby Peterson:

They’re not new to me because I have been practicing in this area for 30 years. But it’s basically sometimes when you have a bill that was unexpected. And typically it’s because you are paying beyond the usual and customary expenses. The hospital says we’re going to charge you $15,000 for this treatment. The insurance company says we only pay up to $10,000. So you typically sign a waiver and agree to pay beyond what the insurance company would pay. You think you’ve got coverage but suddenly you have a $5,000 bill because you have agreed to accept liability. You sign a lot of papers when you go into the hospital or maybe you do the touch screen. Sometimes it leaves you exposed to medical bills and liability.

Frederica Freyberg:

You say what happens in the uncompensated and charity care scenario is that it gets spread around to other hospital bills. So we’re basically all paying.

Bobby Peterson:

Right, at the end of the day, uncompensated care doesn’t just vanish and disappear. We talk about the socialization and redistribution of that debt into everybody else’s bill. It brings up the cost of healthcare in terms of higher costs, more expensive services because those debts don’t just disappear. They actually have to be absorbed in the other expenses of the health care facility.

Frederica Freyberg:

Isn’t that what the Affordable Care Act was looking to get at exactly?

Bobby Peterson:

Right. You think about it, pay me now or pay me later. If we are going to be pro-active and front end, let’s get good, comprehensive coverage for people, for kids. Let’s try and make it seamless so families and kids are together as much as possible. Let’s provide a comprehensive level of service and coverage. Because at the end of the day, if they incur medical debt they can’t pay, it ends up we all end up paying for it in the long run.

Frederica Freyberg:

Bobby Peterson, thank you very much.

Bobby Peterson:

Good to be here.