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When patients don't pay their bills, it can be the hospitals who are left hurting. The News Station's Marnee Banks found out how St. Peter's Hospital in Helena is responding to the increasing number of bad debt cases.

Mike Munck of St. Peter's Hospital Foundation said, "It is tough times, people need more help, people still need medical care, what can the hospital do to help provide that care?"

It is a question that the board at St. Peter's Hospital has been trying to answer. Over the last three years the hospital has seen bad debt and charity care increase at an average rate of 16% per year.

Munck noted, "Charity care, we provide services at a discounted rate, and sometimes we will even totally write off charges based on a person's income level. The bad debt is a little different. Bad debt is where someone receives a service and after repeated attempts to collect for that service, they are unable to pay that bill."

Munck says the increasing amounts of charity care and bad debt are a direct reflection of the struggling economy.

In order to address these growing numbers, the hospital recently changed its policy. Prior to last year, in order to quality for charity care a patient had to earn less than 200% of the federal poverty level. The new policy raises that figure to 250%.

Munck says he hopes the recently-passed federal healthcare legislation will be able to address these growing numbers, but even that is still up in the air. He said, "We don't know at this point, so many of the rules and regulations are still being written, we just don't really know what the outcomes are going to be. We know what the intention is, and I think the intention is a good one. I think that is one of the reasons that everyone is so nervous about this whole thing, is because there is so much that's unknown."

Munck says as the changes in healthcare reform play out, the hospital will be constantly monitoring how it affects the number of bad debts.

In fiscal year 2010, St. Peters Hospital spent just over $13-million dollars on bad debt and charity care combined.

You can learn more at the St. Peter's website, including this brief overview:

Patient Assistance Guidelines. Services eligible under this Poicy will be made available to the patient on a sliding fee scale, in accordance with financial need, as determined in reference to Federal Poverty Levels (FPL) in effect at the time of the determination, as follows:

1. Patients whose family income is at or below 150% of the FPL are eligible to receive free care;
2. Patients whose family income is above 150% but not more than 200% of the FPL are eligible to receive a discount of 50% of their account balance. This discount approximates the percentage that the hospital receives from the Medicare program.
3. Patients whose family income exceeds 200% of the FPL but not more than 250% of the FPL are eligible to receive a discount of 15% of their account balance. This discount approximates the discount given to the largest commercial insurers.