- The Washington Times - Friday, August 27, 2004

A Northern Virginia hospital chain yesterday defended its record of providing care to the poor after a federal class-action lawsuit accused it of price-gouging uninsured patients and hoarding profits.

“We believe the lawsuit is without merit and we plan to vigorously defend it,” said attorneys for Inova Health System. “Throughout our long history, Inova has cared for the people of Northern Virginia regardless of their ability to pay.”

The lawsuit says Inova, which operates five hospitals in the region, charged uninsured patients higher rates than patients who had insurance.

Inova officials have declined to speak about the case but issued a four-paragraph statement.

“We believe the growing number of uninsured Americans is an issue of great importance,” the statement reads. “It is an issue that needs to be resolved with our elected officials at the national level.”

The statement also says Inova recently began offering 35 percent discounts to uninsured patients and that it did not get paid for providing more than $100 million in care to uninsured and under-insured patients last year.

The Fall Church-based Inova is not the only nonprofit hospital to face such accusations.

Since June, more than 40 around the country have been named in lawsuits accusing them of setting higher rates for uninsured patients.

Richard Scruggs, the Mississippi lawyer who led multibillion-dollar litigation against the tobacco industry in the 1990s, is spearheading suits.

He said Inova and others use “aggressive and humiliating collection techniques” to collect payment from uninsured patients while accumulating millions of dollars in assets that should be used for their care.

Richard Davidson, president of the American Hospital Association, has called the suits an “assault on community hospitals.”

Health industry analysts say the debate also raises some long-standing concerns about aggressive hospital billing practices, such as garnishing wages and filing civil lawsuits.

“Clearly, the suits have grabbed the attention of hospitals across the country and have served to highlight billing abuses patients have suffered,” said Mark Rukavina, executive director of the Boston-based Access Project, which studies health-access issues.

“But one of the concerns is that these hospitals are vital community resources,” said Mr. Rukavina, who recently testified at congressional hearing on the issue. “They’re not big tobacco.”

Earlier this week, for example, Mr. Scruggs and his team of lawyers targeted Children’s Hospital of Philadelphia, citing “grossly inflated rates” charged to uninsured patients.

Paul B. Ginsburg, president of the D.C.-based Center for Studying Health System Change, said suing “community institutions” could work against the plaintiffs.

“Locally, Inova is highly respected in the community as a high-quality hospital,” he said. “Overall, hospitals have a great deal of support from the public and elected officials.”

Still, Mr. Ginsburg said hospitals that practice “very aggressive collection techniques” may be “opening the door” to class-action lawsuits.

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