by Karin Price Mueller
Monday August 31, 2009, 8:00 AM
Q: I checked my credit report and saw an inquiry from the hospital system where my wife recently gave birth. What’s the purpose of a credit inquiry by a health care provider?
Could someone be denied care based on their credit report/credit score?
– Surprised Patient
A: Congratulations on your growing family.
No one can check your credit report or credit score without your permission. When you brought your wife to the hospital, paperwork was probably the last thing on your mind.
“When you signed the paperwork for the hospital admittance you also signed an authorization for the hospital to perform a credit check,” said Reed Fraasa, a certified financial planner with Highland Financial Advisors in Riverdale.
If you don’t regularly read the fine print, there have probably been many other times you’ve given permission for a credit check without realizing it. At a hospital, though, the use of your credit information has nothing to do with the care you will receive.
“Hospitals are allowed to pull your credit reports and credit scores but only under the provisions of the Fair Credit Reporting Act (FCRA), more commonly referred to as ‘Permissible Purposes,’” said John Ulzheimer, president of consumer education at Credit.com.
Ulzheimer said they do not use the information as a determining factor to grant or deny care but they can and do use it to determine your likelihood of paying them back, especially if you have an unusually high deductible or are paying out of your pocket.
Essentially, he said, they are granting you a form of credit and they want to know whether or not you’re going to pay them back, just like any other creditor.
There is a fairly vocal and uninformed minority that believes credit reports and scores are used by hospitals to determine whether or not to provide care.
“That’s absolutely untrue and does more to terrify potential patients than it does to set the record straight,” Ulzheimer said. “Credit data is used by their receivables departments simply to identify, after care has been provided, who is likely and who isn’t likely to pay.”
No matter your score, Fraasa said you won’t be denied care, in part because of the Hippocratic Oath. It says, among other things, that the health of a patient will be a doctor’s first consideration, and that doctors won’t permit considerations of age, disease or disability, creed, ethnic origin, gender, nationality, political affiliation, race, sexual orientation, social standing or any other factor to intervene between the doctor’s job and the patient’s needs.