Hospital’s Failure to apply for charity care for psychiatric emergency patient leaves hospital holding the bag

DRAFT   MUST REWRITE    text from daily briefingHEALTH CARE LAW

New Jersey has a Charity Care program which pays for hospital care for uninsured individuals who meet the stringent income and asset requirements and also file an application. If an eligible individual enters the hospital as an emergency room admission, the hospital is required to prepare and submit the application and to take measures to obtain the necessary verifications. If an individual is admitted to the hospital without first going through the emergency room, on the other hand, the individual bears that responsibility. The application can be filed by the individual or a responsible party and the hospital, at its discretion, can accept the application up to two years after discharge, which is also the deadline for a hospital to submit the claim to the state program for processing. The regulations are found at N.J.A.C. 10:51-11. This issue was addressed in the recent Appellate Division decision of Newton Med. Ctr. v. D.B.

The patient had been  involuntarily committed to the hospital’s short-term care facility on an emergent basis when the county PESS determined that he was a danger to himself and others. He met the financial qualifications for charity care, and filled out an application. However, due to his condition, he did not submit all the needed documentation within the required time period, and evidently did not seek the help of another person to gather and submit the required verifications. The hospital eventually sued him for the substantial unpaid bill. He argued that the hospital had a duty to submit the application on his behalf because his emergency psychiatric hospitalization placed him in the same category as a medical patient coming in through the emergency room. Although the trial court ruled against him, the Appellate Division reversed.

In a decision which discusses in depth the history and purpose of the Charity Care Program, the court held that the statute did not explicitly limit the category of emergency room hospitalizations  to medical needs as opposed to  psychiatric need, and that the Legislature intended that all patients in such desperate straits who enter a hospital for emergency treatment be relieved of the responsibility to submit their own applications. The Court placed the responsibility upon the hospital staff to follow the procedures mandated in the regulations for all such patients, and dismissed the collections action.

Admission to any hospital  raises the need for a patient to have an advocate and assistant watching out for his or her interests. Careful planning with powers of attorney, records release authorizations, HIPPA authorizations and health care proxies, including psychiatric health care proxies, can add a layer of protection for an individual in the throes of severe illness.

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