Briefs

By Andy Miller, The Atlanta Journal-Constitution, April 19, 2009

As an Equifax executive, Arvind Krishnaswami saw the chronic gap between what hospitals billed patients and what they received. Hospitals, collecting an average of 10 cents on a dollar, wrote off "a staggering amount of bad debt," he said.

That disparity gave Krishnaswami the impetus to form Roswell-based Medlytix in 2006, joining a wave of companies that use data to help hospitals improve their back-office accounts.

These services - including credit scoring - help nonprofit hospitals identify patients who qualify for charity or free care, those eligible for discounts and those who should pay the whole bill.

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With the 2009 tax year, nonprofit hospitals will be required to give a detailed assessment and value of their charity care and community benefits on a revised IRS form 990.

The new IRS form has driven growth in the hiring of data-mining companies to calculate who deserves free care, said Bruce Nelson of Minnesota-based SearchAmerica.

"We take into account a whole lot of financial circumstances -- credit may or may not be a part of it," he said.

Krishnaswami said there’s a danger in pulling a patient’s financial data before a procedure because it could lead to a hospital denying elective services for the uninsured and underinsured.

Medlytix comes up with a data-driven score that rates consumers’ willingness and ability to pay their medical bills -- but only after the service is rendered, he said.

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