Allina Hospitals & Clinics Responds to Attorney General's Suit
MINNEAPOLIS - January 2009 -- In response to a lawsuit filed today by the Minnesota Attorney General's Office, Allina Hospitals & Clinics made the following statement:
"Allina Hospitals & Clinics is surprised by the Attorney General's action today. Allina had been analyzing various proposals to modify MedCredit's interest rate structure for some time, and prior to the filing of this suit, Allina had made the decision to reduce the interest rate on all current and future MedCredit accounts to eight percent, regardless of the size of the balance. Allina communicated this to the Attorney General in December of 2008. Allina believes that this new rate structure is in the best interests of our patients who would benefit from the ability to pay their medical bills over time.
"While Allina believes the new rate of eight percent is appropriate going forward, it should be noted that the previous rate structure, which included a sliding interest rate scale based on the balance due, was fully consistent with Minnesota law, and was clearly communicated to all patients who participated in the program. The program is considered "open-ended credit," meaning that patients can use the program on an ongoing basis for subsequent care. The rates previously charged by Allina are consistent with Minnesota law for this type of credit.
Allina believes that MedCredit remains a valuable tool to help some patients pay their medical bills and that it may be a better alternative to financing such debt through a credit card, which may charge a much higher interest rate. Allina does not deny care to anyone based on inability to pay, and works with patients to help ensure they receive all possible forms of assistance in paying their medical bills, including free care or government assistance programs. Allina offers free care to individuals and families whose income is less that 275 percent of Federal poverty guidelines.
"Allina believes the allegations contained in the complaint are without merit and that the MedCredit program is fully compliant with the law. Allina looks forward to discussing this matter further with the Attorney General, and bringing it to a timely resolution."
Allina Hospitals & Clinics is a not-for-profit health care system of hospitals, clinics and other patient care services that provides exceptional care to communities throughout Minnesota and western Wisconsin and employs more than 22,000 people. Allina Hospitals & Clinics facilities, services and jobs can be found online at www.allina.com.
Contacts
Allina Hospitals & Clinics
David Kanihan, 612-262-4986
david.kanihan@allina.com
Cell: 612-867-2845
The lawsuit names as defendants both Allina Health System and its subsidiary, Accounts Receivable Services, a debt collection agency owned by Allina that does business under the name MedCredit Financial Services. It seems odd to me that they lowered the rate to 8% which happens to be the legal limit. As a non-profit perhaps they should consider lowering the rate still further, since that could only be in the best interests of their clients...
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