Coming soon to an emergency room near you: medical credit scores.
We've become used to living and dying by our credit scores. They're supposed to have something to do with how likely we are to pay a credit card, a mortgage or a car loan. But there is increasing off label use of credit reports to gague risks for which they were never designed, where no actual credit granting really takes place, like setting car insurance premiums. But suppose we really did live and die by our credit scores?
It's coming.
Last spring, my high school aged daughter was injured in a game of what can only be described as tackle softball, taking the edge of a batting helmet to her face in the process. 11 stitches in the ER later, all we have left is some blood on her glove - and some on my credit report. I used my then-active trusty Horzion Blue Cross card, rather than the school's insurance, which was to reimburse me the ER deductible of $100. Their check never came, mine never went out, Horzion didn't pay all the bill, I kept meaning to write some letters, and a month ago, when I applied for a Kohl's credit card at the cash register to get the extra 15% discount, I was denied. Collections.
The medical center will get their $100 from me, discounted by the cost of the collection agency, and only deft manuvers will keep me from 7 years of credit hell caused by Horizon's inability to coordinate with United Health. How much more efficient for the hospital if it could have run my credit at the front desk, and seen right away that I have had other medical collections. They would have known up front that they weren't going to get their money without a fight. Maybe we wouldn't have been in and out of the ER in 76 minutes. Maybe we'd've waited a little longer. When HMO's went prime time in the 1990's, hospitals would sometimes contact the insurance companies before rendering treatment to be sure it would be paid for.
Car dealers and mortgage companies already use enhanced versions of credit scores designed to reflect the risk that a particular consumer will default on that particular type of debt. Now comes MedFICO, developed in conjunction with Fair, Isaac, the well meaning folks who brought you credit scoring in the first place, with the heavy lifting being done by Healthcare Analytics, whose slogan is "Take Control of Consumer Credit Risk". The other players are Tenet,a 22 hospital chain with locations in 12 primarily Southern states; Boston-based North Bridge Venture Capital Partners. Don't know about you, but I'm sure going to sleep better at night knowing that my health care is in the hands not just of my doctor, or even my hospital, but a data-mining company and a venture capital fund.
The promise is that this financial analysis will be done at the back end, in the billing process, but we all know better. As Healthcare Analytics puts it on their home page, "the average hospital stay is 5 days; however, the collection period for self-pay balances is typically 6 months or more." Prudent financial management on behalf of the shareholders in these for-profit enterprises will have something to do with how hospitals define the words "billing process." Does it start when the patient is discharged from care, whether from the ER or inpatient? Or does it start when the responsible party is routed away from the medical providers to the billing desk to fill out the forms while the patient is treated?
Worse yet, MedFICO is based on the same error ridden, nearly impossible to correct consumer credit reporting system that already grinds us into dust. 25% of credit reports have errors serious enough to deny consumers credit; 79% have at least one error. I am one of the 54% whose report can't even get my basic biographical information right - one report has 22 addresses and 16 'alternate' spellings of my name, some of which are entertaingly phonetic. Though the report efficiently reports a 10 year old paid off tax lien as a "public record", it is clueless as to the public record showing that I was divorced 9 years ago, and still links me to my ex-husband. When I disputed the errors the response was an identical copy of my credit report with a notation that the addresses have been reported by my creditors, and can't be changed. I shudder to think that my children could be denied medical care because Cablevision still thinks my ex-husband never returned that cable box when he moved in 2002. Collection agencies deliberately, and illegally, re-age obsolete accounts to keep the pressure on consumers to just shut up and pay, and zombie debt buyers never give up. Tragically - there is no other word - 50% of collection accounts are medical, and medical bankruptcy is often the result. MedFICO is no doubt intended to highlight just this kind of risk.
Our already broken health care system, collapsing under its own weight, is now to be linked to our equally broken consumer credit reporting system. The phrase "Consumer driven health care" is now enhanced with another dimension of irony.