Pascack Valley Hospital in Bergen County, NJ has emerged as the test case in a legal battle over debt collection that could have major implications for other hospitals when it comes to collecting from union benefit plans.
Pascack, located in Westwood, and at least 13 other New Jersey hospitals have filed lawsuits in an attempt to collect millions in payments they contend are owed them by these plans. The $30,000 Pascack is seeking from the United Food and Commercial Workers International Union Local 464-A Welfare Reimbursement Plan was discovered during an internal audit conducted last year, according to Keith McMurdy, a Roseland attorney representing the hospital. There are two claims involved that date back to 1999, he said.
Hospital officials maintain the union was given a preferred-provider discounted rate as an incentive to pay its claims within 30 days. During the audit, it was discovered that the union had not paid within the discounted time frame, said McMurdy, who is benefits practice group chairman for the firm Grotta, Glassman & Hoffman.
United Food and Commercial Workers is solely a reimbursement plan that reimburses its members for out-of-pocket medical expenses. When one of its members seeks care, the hospital sends the bill to the plan for payment. The union was billed the discounted rate, although it did not end up paying within 30 days, McMurdy maintained.
For this complete story, please visit NJ Hospital Case Could Set a Debt Collection Precedent.
