By Nancy McVicar, South Florida Sun-Sentinel Knight Ridder/Tribune Business News
Dec. 5--In a battle of health-care giants over slow payment of hospital bills, the largest for-profit hospital chain has won an $8.8 million arbitration settlement from one of the largest HMO companies, a decision some experts say may send a message to other HMOs that are late in paying their bills.
'That's a tremendous positive outcome and we would hope that other HMOs would take notice,' said Ralph Glatfelter, senior vice president of the Florida Hospital Association.
Hospital Corporation of America, or HCA, based in Nashville, Tenn., alleged that Humana Medical Plan Inc. of Florida failed to pay or made late payments involving 3,300 hospital patients' bills at 16 HCA hospitals in Florida. The patients were not liable for the bills.
Glatfelter said that despite laws that say insurers and HMOs must pay undisputed bills within 35 days, that is not happening in many cases.
'There are HMOs that either don't pay their contracted rate -- they pay something less, an arbitrary number they make up, or you have situations where they pay late or don't pay at all,' Glatfelter said. 'It will vary from plan to plan. Some have a very good track record, and others don't have a good track record at all.'
In April, the Florida Department of Insurance fined 15 HMOs, including Humana, for late payments. The fines, totaling $550,000, ranged from $25,000 to $50,000. Humana was fined $50,000.
'We're hoping that the arbitration decision coupled with strong regulatory action by the Department of Insurance will provide some encouragement to the HMOs to abide by the law,' Glatfelter said.
Pam Gadinsky, a spokeswoman for Humana in South Florida, said all the contracts involved in the dispute were from PCA, Physicians Corporation of America, an HMO Humana acquired in 1997. She said she didn't know how those contracts differed from Humana contracts or why the bills became disputed.
'We've had a long and positive relationship with HCA over the years and we believe that will continue,' Gadinsky said.
HCA alleged that between 1997 and 1999 Humana took more than a year to pay some hospital bills and that some bills had to be resubmitted several times before payment was made.
Attorney Edward Pozzuoli of the Tripp Scott law firm in Fort Lauderdale, which represented HCA, said the arbitration process took two years because of all the documents passed back and forth in the case.
A three-member panel of the American Arbitration Association ruled in late October that HCA was entitled to the $8.8 million to be paid within 30 days.
Pozzuoli said payment was not made by the deadline, and he has filed for a judgment in Broward Circuit Court. If payment still is not made, the case would be submitted to the Florida Department of Insurance for action, he said.
The hospitals involved include Plantation General Medical Center and Westside Regional Medical Center in Plantation; University Hospital and Medical Center, Tamarac; Northwest Medical Center, Margate; JFK Medical Center, Atlantis; Columbia Hospital, West Palm Beach; Cedars Medical Center and Kendall Regional Medical Center in Miami.
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(c) 2002, South Florida Sun-Sentinel. Distributed by Knight Ridder/Tribune Business News.
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