Health Fraud Complaint Filed Against Newberry, MI, Hospital

A York, PA, hospital bill auditing company has filed a health fraud complaint with the U.S. Attorney for the Western District of Michigan against Helen Newberry Joy Hospital, which is located in Newberry, MI, on the Upper Peninsula. The complaint alleges that the hospital's billing practices with regard to uninsured patients are fraudulent.

The complaint was filed on February 21, 2006, by Edward R. Waxman & Associates, an advocacy organization that audits hospital bills and recovers overcharges for uninsured patients and self-funded health plans all over the country. Edward J. McIntyre of Engadine, MI, who was treated in Helen Newberry Joy Hospital's emergency room and then admitted to the hospital overnight in January 2005, hired Waxman & Associates to audit his hospital bill in March 2005.

Waxman & Associates alleges that when it audited Mr. McIntyre's bill, it found that few of the charges contained in the bill appeared to be properly documented in Mr. McIntyre's medical records. The audit findings report that Waxman & Associates submitted to the hospital asked the hospital to show that the apparently invalid charges were actually valid or to remove the charges from Mr. McIntyre's bill.

Helen Newberry Joy Hospital has never responded to the audit findings report that Waxman & Associates submitted to it in March 2005, according to Ed Waxman, the head of the advocacy organization. In fact, Mr. Waxman says, the hospital failed to respond to eleven letters about Mr. McIntyre's bill that his organization sent the hospital between March 2005 and February 2006.

"When a hospital bill auditor disputes the validity of a hospital's charges," Mr. Waxman claims, "and the hospital is unwilling or unable to show that the charges are valid, the charges are, by default, invalid. Trying to collect invalid charges, which is what Helen Newberry Joy Hospital has been doing by continuing to bill Mr. McIntyre, is a fraudulent act and a blatant violation of his rights as a patient." In addition, according to Mr. Waxman, by not resolving the dispute about Mr. McIntyre's bill in a timely fashion, Helen Newberry Joy Hospital violated the federal Fair Credit Billing Act.

To add insult to injury, says Mr. Waxman, the hospital had its attorney file a complaint against Waxman & Associates with the Better Business Bureau alleging that Waxman & Associates was harassing the hospital by sending it so many letters about Mr McIntyre's bill. The Better Business Bureau requires those who have a problem with one of its members to try to resolve the problem with the member before filing a complaint. But Mr. Waxman says that the attorney did not even contact Waxman & Associates before filing the complaint.

Mr. Waxman says, "I'm not sufficiently paranoid to believe that Helen Newberry Joy Hospital has singled Mr. McIntyre out for special treatment. My assumption is that the hospital deals unlawfully with all of its uninsured patients."

Most independent hospital bill auditors base their operations on two premises, according to Mr. Waxman. First, every hospital has an obligation to provide its patients with bills that contain only valid charges. Second, every hospital has an obligation to respond to and resolve disputes about the validity of the charges contained in its bills. Mr. Waxman refused to speculate about the premises on which Helen Newberry Joy Hospital bases its billing practices.

Numerous class actions have been filed against hospitals that bill uninsured patients improperly. Attorneys who have filed such actions on behalf of the uninsured include the legal team of Richard Scruggs, who masterminded the $200 billion tobacco industry settlement, and Michael Moore, formerly Attorney General of Mississippi. Mr. Waxman and Mr. McIntyre have not made a decision regarding legal representation in this matter.