Mayo Clinic, Allina Health under investigation in Minnesota over medical billing practices

Minnesota Attorney General Keith Ellison is investigating the billing practices of Allina Health, a nonprofit health system based in Minneapolis.

“The high cost of health care in Minnesota and across the country makes it tough enough to afford your life,” Ellison said. “Medical billing practices that are aggressive, abusive or deceptive also make it hard to live with the dignity, safety and respect that everyone is entitled to.”

Earlier this summer, The New York Times interviewed Allina physicians, nurses and patients and found that the system ​​provided care to indebted patients in emergency rooms but restricted services to other patients who had certain levels of debt, with some patients not allowed to return unless their debt was paid in full. Allina restricted care if patients accrued at least $1,500 in debt during three separate instances of care, according to the report. Allina CEO Lisa Shannon announced in June, after the investigation was published, that it had paused the policy.

All nonprofit Minnesota hospitals’ billing and collection practices are governed by the Hospital Agreement, a voluntary agreement negotiated between hospitals and the attorney general. The agreement was first signed in 2005 and is renegotiated every five years. Under the agreement, which was last updated in 2022, hospitals must provide charity care for low-income qualifying patients, with a zero-tolerance policy for abusive practices when recouping medical debt.

“Allina is bound under the Hospital Agreement to refrain from oppressive billing practices and provide charity care when patients need and qualify for it, as all Minnesota hospitals are,” Ellison said.

An Allina spokesperson told Healthcare Dive it was engaging with the attorney general’s office about its compliance with the agreement and the support the health system offers patients with financial needs. Allina operates more than 100 hospitals and clinics in Minnesota and Wisconsin and brought in more than $4.5 million in revenue last year. In 2020, it spent less than half of 1% of expenses on providing charity care, according to the Johns Hopkins Bloomberg School of Public Health.

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Ellison previously has scrutinized other aggressive hospital billing and collection practices in the state, including an ongoing investigation into the Mayo Clinic over allegations that the system sued patients with outstanding medical bills who ought to have qualified for charity care. The attorney general’s office opened its investigation into Mayo Clinic’s “apparent aggressive bill-collection conduct” following a report last November about the hospital suing low-income patients for unpaid medical bills.