Florida health system sues bill splitting department for nonpayment

Diving brief:

  • Orlando Health, a system of 16 hospitals operating in central Florida, has filed a lawsuit against Liberty HealthShare, accusing the faith-based cost-sharing organization of failing to pay for medical services provided to its members.
  • The lawsuit, filed Thursday in U.S. District Court in Orlando, alleges Liberty notified the hospital system in August 2021 that it owed approximately $1.1 million for a “large block of claims,” ​​but that it then failed to provide information that would allow Orlando Health to verify outstanding account balances.
  • Orlando Health accuses Liberty, which also operates as Gospel Light Mennonite Church Medical Aid Plan, of asking patients not to disclose the organization as an outside funding source in order to “illegitimately obtain” the rate of charity “reduced for medical services”. according to the complaint.

Overview of the dive:

Shared Health Care Ministries are faith-based organizations that have grown in popularity in recent years as a cheaper alternative to health insurance. Prior to the repeal of the Affordable Care Act’s insurance mandate, HCSM members were also exempt from the penalty tax for people without coverage.

But cost-sharing programs, which collect payments from members, are not subject to the minimum coverage standards and other requirements that apply to insurers under the ACA. HCSMs have caught the attention of state regulators who have raised concerns that some organizations might mislead consumers into believing that coverage is guaranteed for claims.

California Attorney General Rob Bonta sued an Atlanta-based group, Aliera Companies, in January, accusing the company of defrauding consumers by selling unauthorized health plans through Sharity Ministries and collecting hundreds of millions of dollars in monthly premiums while refusing to pay members’ medical claims. Sharity Ministries filed for bankruptcy in 2021.

In its complaint against Liberty HealthShare, Orlando Health said it received a letter from Liberty in August 2021 stating that the HCSM owed the hospital system approximately $1.1 million. But Liberty did not provide any patient names, procedures, services, dates, account numbers or other information to identify the claims, and it did not respond to a later request from the hospital system for a list of accounts to verify. outstanding account balances.

Liberty said the discrepancies with the claims involved the organization’s 90-day waiting period, “when health insurance is primary,” and that conditions associated with lifestyle and “other moral choices that are outside the values ​​and beliefs of our program,” according to the lawsuit.

Orlando Health said it was not aware of any Liberty member patients or even that the HCSM owed it money when it received the August 2021 letter, but later learned that Liberty had asked patients to “intentionally withhold information” from the hospital operator. Orlando Health said it had no record of patients identifying Liberty as an outside source of medical expense funding during the patient admission and check-in process.

The hospital system asked the court for a full account of all the medical services it provided to Liberty members and the discrepancies mentioned in the organization’s letter, in addition to all amounts owed for the care it provided. provided to these patients.

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