In 2007, a large Minnesota hospital and credit agency proposed a $3 million venture to develop a “medical debt score.” The new system would have tallied patients' unpaid medical bills to help providers determine whether their patients could pay for future care. Consumer advocates argued that a financial tracking system would fundamentally change the way care is delivered in the state by denying those with any kind of financial debt access to care. “Health-care debt is fundamentally different from any other consumer purchase because people do not choose to get sick,” said Minnesota State Attorney General Lori Swanson.

In May 2008, the Minnesota legislature passed a bill that would have protected individuals from being denied medical care because of their poor financial credit. The bill was ultimately vetoed by the Governor, but it's seen by many as being a possible harbinger of things to come, as medical costs—and medical debt—rise.

“Medical debt is a huge problem in this country, and not just for [individuals] without health insurance,” said Swanson, who helped draft the bill. Nearly half of all Minnesotans with medical debt have some form of health insurance, and nearly 1 million Minnesota residents spend 10 percent of their pre-tax income on medical care, which according to the Commonwealth Fund qualifies them as medically underinsured. “When you superimpose the terrible economy, skyrocketing fuel prices and the mortgage meltdown we are facing onto high deductibles and huge out-of-pocket [medical] expenses, health care is being pushed out of reach from even more Minnesotans,” Swanson said. 

The bill would have prevented health-care providers from disclosing patients’ financial or medical debt information to another entity.  Hospitals and physicians also would have been prohibited from obtaining such medical or financial debt information prior to providing medically necessary care.  Providers would have been permitted to continue to collect insurance information, and financial and medical debt information prior to elective procedures.

In his veto message, Governor Tim Pawlenty noted that while he supports efforts to prevent providers from using credit ratings and credit reports to determine whether to provide essential medical care, the bill contained “extremely broad terms,” which could have caused “confusion and unintended consequences.”  In the absence of defining terms such as “financial information” or “medically necessary,” the bill could have forced providers to make changes in how they offer routine medical care and could have increased medical bills.

However, the fight isn’t over. Supporters of the bill say they will rework the text to try to satisfy the Governor’s objections. “We want to make sure that financial information is not accessed prior to treatment so it can’t influence what care is recommended,” said bill co-sponsor  Representative Diane Loeffler. “Patients want to know that their doctor is recommending the best care for their health problem, not the best care given what they can pay.”

“Really, denying patients care because of their poor financial situation is a violation of the Hippocratic Oath doctors’ take,” said Senator Linda Berglin.

© Copyright 2008, State Health Notes