Do you know your medFICO score?

Imagine you are in a bad car accident, and you need to have a complicated surgery to reattach two of your fingers.  As you roll into the emergency room, a woman asks you, “Do you have insurance?”  You reply, “No. I actually canceled my health insurance two months ago.”  The woman says, “Will you be paying for your surgery?”  As much as you would like to inquire about the cost, you opt not to.  You figure that the more time you brood over the bill, the more likely you will be without two fingers.  You answer reluctantly, “Yes. I will.”  The woman nods and leaves the room quicker than she entered.

A few minutes later, she returns and says, “I have some bad news, sir.  We pulled your credit report and received your medFICO.  Apparently, you have a poor repayment history with hospitals, and therefore we require a 25% down payment before we can reattach your fingers. If you cannot provide that down payment, you can still receive the surgery; however, it will be performed by our intern.”  There is nothing you can do.  You want to give her the finger, but she already has two as collateral. 

This is a frightening scenario, but not quite reality. 

In Jan. 2008, these types of hypothetical stories spread on the internet as consumers learned about a new company based in Waltham, MA called Healthcare Analytics Inc., which unveiled a product to address challenges posed by self-pay patients.  The company, which has since been renamed Connance Inc., is partially funded by Fair Isaac Corporation.  The term medFICO was coined last year to explain the frightening idea of basing one’s access to healthcare based on a credit score similar to the FICO score. 

While Connance representatives say that the new FICO-backed project will not deny patients access to healthcare and will only help with collection efforts after the fact, skeptics believe that there is not enough oversight to guarantee responsible behavior. In fact, Minnesota lawmakers passed a bill last year to prohibit hospitals from using information about a patient’s medical debt to decide whether to treat the patient.  The bill was later vetoed by Governor Tim Pawlenty.

The idea of a medFICO score, which some claim to be a misnomer, did not receive a lot of major media coverage. However, I think it is time to reintroduce the subject for a more critical analysis given the exposure of insidious predictive analytics carried out by banks like American Express.

Here’s the connection.  Because companies can reduce your access to credit based on where you shop, it is certainly possible that these same companies can see, for example, that you bought medicine for a certain ailment and consequently change your terms for the worse.  Such Orwellian examples–and there many out there–are not so crazy anymore.

In brief, if reputable companies are already doing it secretly, there is no doubt in my mind that hospitals will do it as well.  Unfortunately, the reality of a private healthcare system is that like any other business, profits and minimizing risk are often more important to shareholders than patient welfare.  For this same reason, private insurers reject people with pre-existing illnesses. Considering the crazy times in which we live, it is time to explore this topic again and reintroduce legislation that will prohibit such practices.  If I have learned anything from my experience, it is that we have to be proactive and not reactive in fighting unjust predictive analytics. 

[ Read more information about this at CreditCards.com. ]

Comments

[car accident claim]

Before you make car accident claims for compensation, two criteria have to be fulfilled. Firstly, that you have indeed sustained a personal injury, and secondly, that there was a negligent driver whose lack of care caused those injuries. If you have been unable to get the negligent driver´s details, or were the victim of a hit-and-run, these details can be determined by the use of modern roadside technology.

[Holly]

PS.....

I use the AMEX card for my cancer pill because my med bills are enough that my Accountant needs my annual medical expenses for my return. It's easier for me to track if I have the charge account record, I reconcile my credit card in QBP, I'm afarid if I pay cash that won't make it into the system/I might overlook it. If I would die, there is enough money in my estate to pay AMEX.....

[Holly]

Kevin,

Interesting thought, AMEX has never given me a reason why they reduced my line. I was diagnosied with Breast Cancer in 2007, I am now on a Cancer pill that I re-fill at Walgreens every 30 days using my AMEX card. I would hate to think that AMEX reduced my credit line because they were afraid I would die and they would not get their money???

[Carole May]

I'm glad I pay cash for my prescriptions! I keep saying it, but all of this is getting insane!

[Jason Allen]

DO YOU KNOW WHY THE GOVERNOR VETOED THE BILL? FROM WHAT I UNDERSTAND ABOUT THIS ISSUE HOW CAN YOU NOT PASS A LAW PREVENTING THIS NONSENSE? ISN'T FICO IN MINNESOTA? MAYBE THEY LOBBIED HARD TO MAKE SURE THE GOVERNOR DIDN'T PASS THE BILL. MAYBE THEY THREATENED TO LOWER HIS FICO SCORE. HA!