Nonprofit healthcare system Allina Health will no longer ban patients with unpaid medical debt from using their services, it announced on 24 August. The policy was first brought to light by a New York Times investigation earlier this year, which revealed that Allina was barring patients with over $4,500 in unpaid debt from certain non-emergency care, including care for chronic conditions.
The reversal has largely been attributed to public pressure following the report’s release, alongside the announcement of an investigation into their billing practices by the Minnesota Attorney General. Healthcare investor and co-founder of private equity firm NaviMed Capital, Bijan Salehizadeh, has extolled the virtues of healthcare journalism in preventing these practices.
Nonprofit hospitals are required to provide charity care for patients who cannot afford to pay in exchange for tax exemption, but there is no clear definition of where the bar should be set. The Times investigation reported that Allina spent less than 0.5% of its expenses this way, over four times lower than the national average.
The embattled company is facing pressure from inside the company, too. In July, it laid off nearly 350 members of staff due to “unprecedented finial challenges”. Allina reported an operating loss of around $198.6m in 2022, nearly a $700,000 increase on the year before. Despite these travails, the company’s CEO was paid $3.5m in 2021.
The layoffs do not seem to have been matched by a major decrease in overall recruitment at the company, according to GlobalData analysis, with a stable number of active job postings between March and July.
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