Topeka Atty. Gen. Phill Kline on Thursday announced his office was investigating billing and collection practices of the state's not-for-profit hospitals.
The probe has involved the amount of charges for medical care, hospital contracts with collection agencies and how those agencies try to collect debts, Kline said.
"Hospitals have a right to be paid for the services that they render," he said. "But that right does not extend to unconscionable and coercive collection practices."
Kline declined to say how many hospitals had been the focus of complaints, nor how much in billing was involved since the investigation started last year.
Kline has appointed Bob Stephan, a former Kansas attorney general, to lead negotiations with not-for-profit hospitals to come up with guidelines for billing and collections. The office has requested information and even issued some subpoenas, Kline said.
"The plight of the poor, the uninsured and underinsured with regards to medical and hospital care is tragic," Stephan said. "It's a living hell for a lot of poor people."
There are 121 not-for-profit hospitals in Kansas, including Lawrence Memorial Hospital.
"There aren't any nonprofits that won't be looked at," Stephan said.
Officials at LMH said Kline's office had not requested or subpoenaed any information from the hospital, 325 Maine.
"We always pursue best practices," said Janice Early-Weas, director of community relations at LMH. She said the hospital was generous in its guidelines for charity care.
In 2005, the hospital's net patient revenue was $114.3 million, while it performed $3.86 million in charity care and sustained $9.2 million in debt for unpaid bills, she said.
About 2.5 percent of all patient accounts end up in some kind of legal process for collections, Early-Weas said.
"Those would be only folks who have ignored all attempts to collect and who we feel have an ability to pay something," she said.
Cindy Samuelson, vice president of the Kansas Hospital Assn., said she didn't think Kline's allegations were widespread.
Kline's office has requested information from the association concerning how hospitals charge and collect unpaid bills, she said.
She said Kansas not-for-profit hospitals provided $170 million in charity care in 2004.
Kline said sometimes disputes arise after hospitals submit bills to the wrong insurance company, or the hospital fails to get prior authorization for services billed. That starts a collection process that is sometimes aggressive and unfair to the patient, he said.
Samuelson said hospitals were always trying to become more efficient in those areas.
"I really think that is the mission that hospitals have to work on, and that is to get better information from the patients," she said. "That would avoid some of these problems."