Most of the changes coming when Wellstar takes over operations at AU Health will be on the back end, but once the deal is finalized, the clock will start with a policy change that could impact several patients.
For the first year, the new Wellstar MCG Health will continue AU Health’s existing charity and charitable care policies. After one year, the new organization will transition to Wellstar policies.
Earlier this month, documents outlining the process through which Wellstar will become the sole corporate member of AU Health were made public for the first time. The 89 documents filed for routine statutory review with the attorney general’s office outline what will change and what will stay the same.
Wellstar declined to comment on the details of this story, citing ongoing work on the deal, and referred the Chronicle to AU Health. AU Health had no further comment.
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“While Wellstar is excited about the many community benefits of our potential partnership with the Augusta University Health System, we are still working together to finalize details and secure regulatory approvals to move forward,” Wellstar spokeswoman Kristy Helms wrote in an e-mail.
According to the Kaiser Family Foundation, non-profit hospitals must establish a financial assistance policy to determine who is eligible for charitable assistance, limit expenses for charitable assistance, and see if patients are eligible for the charitable assistance before attempting to collect the debt, among other requirements. On average, the Foundation estimates that inpatient charitable care accounts for 1.4% of operating expenses. The specifics of the policy are up to the healthcare system.
“Hospitals can sort of set their own criteria for who is eligible,” said Leah Chan, a senior health analyst at the left-leaning Georgia Budget & Policy Institute.
AU Health policies against Wellstar
According to documents available online, Wellstar and AU Health’s policies are not radically different for charitable care, meaning care provided free of charge to uninsured or underinsured people.
Wellstar policies offer a discount to all uninsured people, between the cost of care and the federally defined “Generally Billed Amounts,” or the average charged for a procedure to uninsured people. Wellstar will cover all costs for individuals earning up to 125% of the federal poverty level and up to 97% of the amount typically billed for individuals earning up to 200% of the FPL. More discounts can be added for people making up to 300% of the FPL.
AU Health’s Care for the Indigent policy states that those earning less than 200% FPL are eligible for free care. Those earning up to 400% FPL may receive additional discounts depending on the total amount they owe (for example, someone earning 400% FPL would have no discount on a $10,000 bill but would receive a 85% on a bill over $100,000).
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The amount of indigent and charitable care AU Health provides each year varies, but a fair market analysis and community benefit assessment, prepared for AU Health as part of the merger, estimates it to be approximately $65 million based on historical averages.
There are also schemes to support hospitals that provide this charitable assistance. Georgia has the Indigent Care Trust Fund, which Chan says receives funding through taxes, federal matches and other programs. Healthcare workers can get reimbursed for charitable care provided by this fund.
According to an AU Health financial statement also filed as part of the merger, AU Health raised approximately $14.9 million in fiscal 2022 and a similar amount the year prior. It also received approximately $7.2 million from a similar program for South Carolina Medicaid hospitals.
Chan, for his part, would like to see Georgia expand Medicaid to reduce the number of uninsured people seeking charitable assistance. This summer, Georgia will begin a limited expansion of Medicaid called Georgia Pathways, likely to expand assistance to about 90,000 Georgians, but not a full expansion for all Georgians earning less than the FPL’s 138 percent.
“One thing we could do politically is to expand Medicaid completely so we don’t have to depend on the goodwill of hospital systems,” Chan said.
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