(Crainâ€™s) â€” Advocate Health Care said Wednesday it will refund as much as $3.5 million to needy patients to settle a class-action lawsuit that accused the hospital system of overcharging the uninsured.
The Oak Brook-based network of nine hospitals will recalculate bills for any patient who paid for treatment since November 2000 and who was qualified for free or discounted care under Advocateâ€™s current financial-assistance program.
Advocate, the stateâ€™s largest hospital system by revenue, implemented a more generous financial-aid program in 2003, one year after the lawsuit was filed. It offers free or discounted care to anyone who earns up to 400% of the federal poverty level, or $82,500 for a family of four.
Even though that program has existed for years, patients who qualified for discounts might not have applied. The settlement â€œgives them another opportunity to come forth and fill out the application,â€ an Advocate spokeswoman said.
A Cook County Circuit Court judge still must approve the settlement at a hearing set for Feb. 25.
â€œWe shouldnâ€™t have to sue hospitals in order to ensure children and families can get the care they need,â€ the plaintiffâ€™s lead attorney, Tom Geoghegan, said in a statement. Mr. Geoghegan, a Democrat, is running for the 5th Congressional District seat vacated by U.S. Rep. Rahm Emanuel.
Resurrection Health Care, the areaâ€™s second-largest hospital system, also recently agreed to settle a similar class-action suit filed by uninsured patients in 2004. The eight-hospital Chicago system said it will recalculate medical bills charged to any uninsured patients who received care between Sept. 16, 2001 and Sept. 19, 2008.
The refunds will reflect deeper discounts that Resurrection put in place for 2009. It will refund the difference in the form of vouchers for future medical services on any payments that patients made in excess of $500.
The billing practices of both Advocate and Resurrection had been criticized by separate labor unions seeking to organize hospital workers. They also drew scrutiny from lawmakers, including U.S. Sen. Charles Grassley, R-Iowa, who have questioned whether large nonprofit hospitals systems are offering enough free care to earn their charitable tax breaks.
Neither Advocate nor Resurrection admitted any wrongdoing as part of the settlements.