By SARAH RUBENSTEIN The Wall Street Journal, Page D1 March 18, 2008

Many Are Using Personal Data To Assess Your Ability to Pay; Concerns About Denial of Care

In a development that consumer groups say raises privacy issues, a growing number of hospitals are mining patients’ personal financial information to figure out how likely they are to pay their bills.

Some hospitals are peering into patients’ credit reports, which contain information on people’s lines of credit, debts and payment histories. Other hospitals are contracting with outside services that predict a patient’s income and whether he or she is likely to walk away from a medical bill. Hospitals often use these services when patients are uninsured or have big out-of-pocket costs despite having health insurance.

Hospitals say the practice helps them identify which patients to pursue actively for payment because they can afford to pay. They say it also allows them to figure out more quickly which patients are eligible for charity care or assistance programs.

Administrators also argue that these credit checks can help them minimize losses. In 2006, nearly 5,000 community hospitals provided uncompensated care costing $31.2 billion, the vast majority of it charity care or unpaid patient bills, according to the American Hospital Association.

Original Article from the Wall Street Journal (opens in a new window - subscription required).