A New York Times investigation examines Providence’s aggressive financial practices

The New York Times took a close look at the financial practices of Oregon’s largest hospital system, Providence Health, on page A1 today. What the newspaper found is not pretty.

That Times relied on a Washington state lawsuit and interviews across the Providence system, which includes 91 hospitals and 900 clinics in West and Texas. (Providence operates six hospitals in Oregon.)

Among the results, Providence, a nonprofit that is exempt from corporate income taxes, paid consulting firm McKinsey & Co. $45 million for advice on increasing revenue through a program called Rev-Up.

Providence aggressively pursued payments from Medicaid patients in Oregon, Washington and California Times found, apparently in violation of laws that say hospitals must accept state reimbursements for patients whose low income qualifies them for Medicaid and not charge additional fees.

In exchange for the tax exemption, hospitals are expected to offer some free care to people who cannot afford their treatment costs. That Times found Providence’s efforts wanting:

“Providence sits on $10 billion that it is investing Wall Street style alongside leading private equity firms. It even runs its own venture capital fund,” the newspaper said.

“In 2018, before the Rev-Up program started, Providence spent 1.24 percent of its spending on charitable nursing, a standard way of measuring how much free hospital care is hospitalized provide. That was below the national average of 2 percent for nonprofit hospitals.”

Oregon’s hospitals are almost all nonprofit, and critics have long questioned whether they provide enough charitable care. This question was the subject of a ww Cover story in 2016. Legislatures passed legislation in 2019 establishing a minimum level of charity care in Oregon hospitals.

Related: The five things hospitals don’t want you to know about Obamacare

Providence pressed hard against her Times Story she called “absurd” in an internal email sent to employees and issued a long explanation as answer.

“The notion that Providence is deliberately taking advantage of those who are vulnerable could not be further from the truth of who we are,” the statement said, noting that the providential system will cost US$1.9 billion in 2021 provided dollars in community services. That includes $271 million in charitable care and $1.2 billion in Medicaid losses.”

Providence acknowledged that the charitable maintenance percentage has gone down, but said there’s a reason for it.

“In terms of a decline in charity supply, it’s important to note that our Medicaid losses have been increasing at the same time. This is because many people who would have previously qualified for charity care are now covered by Medicaid thanks to the Affordable Care Act.”

Providence also bought a full-page ad in the front of the today Oregonians to commend his generosity.

https://www.wweek.com/news/2022/09/25/a-new-york-times-investigation-examines-providences-aggressive-financial-practices/ A New York Times investigation examines Providence’s aggressive financial practices

Mike Fahey

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