Providence, one of the nation’s largest hospital systems, will refund payments made by more about 760 low-income patients who were pressured into paying medical bills — even though they were entitled to free care.
The refunds come after an investigation from The New York Times found Providence pressured qualified Medicaid patients to pay with a program called Rev-Up, which, designed with help from consulting firm McKinsey & Company, hounded patients and sent them to debt collectors if they failed to make payments.
The system began reaching out to refund-eligible patients in late September, Melissa Tizon, a spokesperson for Providence, told Healthcare Dive in an email, adding that patients were asked to pay due to an error when Providence was updating its automation processes and that it began refunding patients in December.
“Recent coverage by the New York Times paints a false narrative that Providence intentionally takes advantage of the poor to enrich itself,” Tizon said. “This could not be further from the truth.”
Although the Rev-Up program was originally aimed to those understand their bills, Tizon said, the system acknowledges that “the training materials, and even the name Rev Up, were not consistent with our values.”
Nonprofit hospitals are exempt from paying taxes in exchange for providing some type of community-supporting benefit.
But last year, Providence spent less than 1% of its expenses on charity care, according to the system’s audited financial reports, and a 2018 report found that nonprofit systems spend less on charity care than for-profit peers.
Providence spent less than 1% of its expenses on charity care in 2021
The system reported a $934 million operating loss through the first half of the year as patient volumes stagnated and labor expenses rose. As a result, Providence announced in the summer that it would begin restructuring and reducing executive roles amid persistent operating challenges.