Please note: Mosaic amended its submission of final results to Senator Grassley’s office on May 27, stating that the $16.9 million in debt relief applies to 3,342 patients rather than 5,070 patients. Here is Mosaic’s note:
“We received 5,070 applications for financial assistance between October 1 and December 31. Of those 5,070, we attribute 3,342 of those applications to the medical debt grace period and attribute 1,728 of the applications to our standard financial assistance efforts.
“Our estimated average write-off per application of $5,052 was derived from dividing the $16,885,358 in write-offs we attribute to the medical debt grace period by our 3,342 applications attributed to the medical debt grace period.”
WASHINGTON – Sen. Chuck Grassley of Iowa today released the results of his 16-month-long inquiry into a Missouri non-profit hospital in the spotlight for aggressively suing low-income patients. Thanks to Grassley’s inquiry and persistence, Mosaic Life-Care approved debt forgiveness for 5,070 patients totaling $16.9 million.
“Tax-exempt hospitals cannot be in business to profit off of poor people who may not know what form to file,” Grassley said in a speech on the Senate floor in announcing the results. “That is not what Congress intended to happen when we created the tax exemption. Now, thousands of people have a new lease on life, thanks to Mosaic’s meeting its tax-exempt responsibilities.
“Now a lesson to all 535 members of Congress that I want to point out. This is why oversight is so important. That is why I take my oversight responsibilities as Chairman of the Judiciary Committee so seriously. Results matter.”
Grassley released the results of his inquiry to Mosaic in a memo to the members of the Finance and Judiciary committees. In addition to the debt forgiveness, Mosaic hired additional personnel to assist low-income persons with filing for financial assistance, will no longer charge interest on accounts until final judgment, and has extended its four-statement billing cycle to six.
Grassley initially wrote to Mosaic in January 2015 after news reports from ProPublica and National Public Radio documented aggressive debt collection via lawsuits against Mosaic patients. This caught Grassley’s attention as a long-time advocate for making sure tax-exempt organizations, including hospitals, meet their obligations under the tax code. Grassley is former chairman of the Finance Committee, with exclusive Senate jurisdiction over the tax code.
Grassley’s memo is available here. Video of his floor speech describing his inquiry and the results is available here. The text of the floor speech follows:
Floor Statement of Senator Chuck Grassley of Iowa
Investigation into Mosaic, a Non-profit Hospital
Tuesday, May 24, 2016
I want to address an important investigation that has produced significant results for low-income people that the Republican Majority in the Senate helped bring about.
In late December 2014, news reports indicated that a non-profit hospital chain in Missouri and Kansas, Mosaic Life-Care, had been aggressively suing low-income patients.
These news reports further indicated many of these patients qualified for financial assistance and were wrongly placed in collection.
Let me be clear, non-profit hospitals should not be in the business of aggressively suing their patients.
As recipients of a tax-exempt status, these hospitals have a heightened duty to assist patients in qualifying for financial assistance.
That means these hospitals must implement a financial assistance policy whereby low-income persons receive free or reduced-cost care.
Further, these types of hospitals must assist low-income persons in ensuring that the proper paperwork for government assistance or private insurance is properly filed.
In essence, because of the favorable tax treatment these hospitals receive, they have a duty to help our nation’s most vulnerable.
For these reasons, I began my investigation into Mosaic to determine what, if anything, went wrong.
On January 16, 2015, I sent a letter to Mosaic to begin my inquiry.
Over the past year, my staff has met with Mosaic representatives, exchanged numerous emails, and had many phone calls to get a better idea of the process at issue.
It became clear that Mosaic was lacking the right number of personnel to manage financial assistance intake.
Common sense tells me, when anyone visits a hospital it is often a scary event under any condition.
When we go to hospitals, it’s generally because something has gone wrong.
In that moment of need, we put our lives in the hands of professionals to help us get healthy.
In those moments of pain and fear, we put our trust in medical professionals to give us the right care.
In other words, we place our trust in the hospital to have hired the right people.
And normally after treatment is provided, here comes the bill.
Again, common sense tells me nothing in life is free. Someone, not always the patient, will always have to pay the bill.
Common sense, no free lunch. But, when it involves low-income persons, and a non-profit charity hospital has provided the treatment, that hospital should provide some type of financial assistance or help to get financial assistance if it’s available.
That obligation exists simply because of the tax-exempt status.
If you want that status of tax exemption, you’re supposed to help those less fortunate.
So, when that bills comes, the hospital must ensure that it has people in place to assist the patient in filing for financial assistance if it’s available.
And if the patient doesn’t have any coverage but his or her income is so low that they qualify for free or reduced-cost care, the hospital should ensure that patients know that help is available. It’s common sense.
Employees should explain the process and patients’ rights.
Tax-exempt hospitals cannot be in business to profit off of poor people who may not know what form to file.
That is not what Congress intended to happen when we created the tax exemption.
During the course of my investigation into Mosaic, I made clear that they must have adequate personnel.
In response to my overtures, Mosaic has hired seven resource advocates to assist with Medicaid, Supplemental Assistance, and Social Security Disability applications.
Two additional Financial Counselors were re-assigned to focus solely on assisting patients navigate the financial assistance process.
Importantly, Mosaic will hire an additional Financial Counselor dedicated to its outpatient clinic.
And finally, five Patient Financial Service representatives have been assigned with the duty of ensuring the timely processing of financial assistance applications.
These are very important as well as and productive steps to take.
It just makes sense for a charitable health care institution to help its low income patients rather than sending debt collectors after them and suing them.
It’s common sense. You can’t get blood out of a turnip.
Further, during the course of my investigation, I made clear that charging interest on accounts prior to final judgment would further burden the poor.
Non-profits need to take steps to reduce debt burdens, not increase that debt.
In response, Mosaic will no longer charge interest on accounts until a final court judgment.
And further, to provide even more opportunity for patients to receive financial assistance, Mosaic has extended its four-statement bill cycle to six.
That will allow more opportunities for patients to receive notice of their ability to receive financial assistance.
These steps will help patients in the long run.
Again, common sense tells me it is important to note that there is a certain amount of self-responsibility to be accepted when someone incurs a bill for services rendered.
But, that doesn’t mean hospitals shouldn’t lend a helping hand.
Just look at the Medicare and/or health insurance bill that you get. You know then how intimidating that document can be.
The changes I just mentioned are not the end to all of this, however.
I’d like to note a much more profound result.
I repeatedly urged Mosaic to look at low-income patients already in the collection system or in the court system.
Over the course of several months, I urged them to consider forgiving their debt when it was obvious people didn’t have the income to pay.
In response, Mosaic instituted a 3 month debt forgiveness period running from October 1, 2015, to December 31, 2015.
Importantly, during this forgiveness period, Mosaic lowered the threshold by which a patient could qualify for financial assistance.
Whether a patient was in collection, or already subject to a court judgment, they could apply for debt forgiveness.
Mosaic recently informed me of the results of their change of policy.
The debt forgiveness period resulted in 5,542 financial assistance applications of which 5,070 were approved.
A total of 16.9 million dollars in debt, interest, and legal fees were forgiven.
Over five thousand people no longer have to worry about their debt burden.
Five thousand people are free from the vise grip of almost 17 million dollars.
Medical debt is vicious.
It is a mental and emotional drain that can bring the strongest among us to our knees.
For some patients, they will never be able to pay off their debt.
Mosaic eventually did the right thing, and it deserves credit for that.
It probably shocks Mosaic that I would compliment them, considering where I started in this investigation. But I speak from the heart that when they make these changes, they ought to be complimented now.
Now, thousands of people have a new lease on life, thanks to Mosaic’s meeting its tax-exempt responsibilities.
That’s where we’re coming from. If it hadn’t been for the tax exemption and accepting the responsibilities of tax exemption, there would be no way we could complain about Mosaic.
Now a lesson to all 535 members of Congress that I want to point out.
This is why oversight is so important. That is why I take my oversight responsibilities as Chairman of the Judiciary Committee so seriously. Results matter.
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