Can Credit Affect your Healthcare?
New Medical Credit Score Causing Concerns Among Industry Watchdogs.
Fair Isaac states the hospitals could be using a new medical score (medFICO) as early as this summer. Some are concerned about the impact on healthcare.
Financial institutions use your credit score to decide which services you qualify for. With advances in the sophistication of credit reporting, people are concerned a new medical credit score, called medFICO, might impact the medical services that patients receive.
What is medFICO?
A Massachusetts-based company named Healthcare Analytics is designing the medFICO score. They are receiving financial backing from Fair Isaac Corp, Tenet Healthcare Corp, and North Bridge Venture Partners, who have each contributed $10 million to develop this scoring model.
The arguments for medFICO
Fair Isaac, a leader in the credit reporting industry, states the hospitals could be using the new medical score as early as this summer. However, some individuals, such as Linda Foley, with the Identity Theft Resource Center located in San Diego, CA, are raising questions about the use of the medFICO score. That some patients might be denied or given subpar medical attention because they have low medical scores – which signal that they might not pay their bills, is a concern.
The medical industry says the medFICO scores will not be used in a discriminatory fashion. In fact, the scores are not to be checked until after the patient has received services. According to Stephen Farber, the chairman and chief executive of HealthCare Analytics, the scores will only be checked after the patients have already been discharged.
MedFICO purposes and ramifications
Thus, this leads some people to question how the medFICO scores could be useful to anyone. If they are only viewed after the patient has received services and been discharged, then why even keep track of the financial score?
According to Farber, the medFICO score will be used to decide whether the hospital will need to write the bill off as a loss - or if they should exert time collecting payment from those who have missed their payment deadlines. He asserts the score will be used by the hospitals to decide how much financial relief the hospital should give the patient – not the services provided.
Tracking financial accountability in medical treatments
Traditionally, hospitals pursue payments by using collection agencies. The hospitals and medical clinics themselves do not usually report the late or unmade payment to any credit agencies.
While hospitals are able to check patients’ credit reports, these reports do not provide adequate information about whether the patient will pay or not. The healthcare industry says that most of the late payments that show up on credit reports are for voluntary purchases. Just because a person is lax about paying these bills does not mean that he or she is lax about paying bills for involuntary services, like medical procedures.
Some people see other problems in the medFICO score other than possible abuses. The current credit score, for instance, is often incorrect. The Consumer Federation of America has found that 29% of the scores that they checked were 50 points below the true score. Others wonder if it is responsible to create a new system based on one that already does not work correctly, typically caused by a mix up in names and social security numbers.
The debates about the medFICO scores continue as several hospitals around the country prepare to begin using it as a part of their daily operations.
