The Southern Maryland Hospital Center will refund a total of more than $800,000 to nearly 3,000 patients who were charged an extra $276 each for one hour more than they actually spent in the hospital's opetating room, the hospital's chief administrator said yesterday.
The hospital began revising unpaid operating room bills downward last week, and, when the process is complete, will begin making refunds to patients who already have paid their bills according to administrator William L. Shepherd.
The hospital said the overcharges - made between May 9 and Sept. 29 - were a result of "an oversight." They came to light when the Maryland Health Services Cost Review Commission released an auditor's report saying the hospital may have overcharged its customers a total of $1.8 million, including the extra operating room time.
It's my understanding that the hospital administrators (including Dr. Francis P. Chiarmonte, the hospital's founder and director sat down and decided that since there was no charge for time spent prepping for operations or for time spent in recovery that it would be easiest to add an hour of operating fees to cover those costs," Shepherd said.
"A request was supposed to have been submited to the commission but somehow it never got done," Shepherd said.
The state commission sets rates for all hospitals in the state and it is illegal to charge rates other than those set by the commission or to charge a new rate without permission from the commission.
The commission's rate schedule includes the cost of prepping patients and the recovery room in the hourly operating room charges.
"The hospital had no right whatsoever to add that charge to its fee," H.D. Reiff Jr. deputy director of the commission said yesterday.
Shepherd said that other alleged over charges singled out by the auditors were no longer being levied. These include: a $5 charge for supplies for each patient who used the emergency room (in addition to the $30.80 emergency room fee); a $225 charge for acute rental dialysis; a $244-a-day charge for each day a baby spent in the nursery intensive care unit, and a 30 percent overcharge ($4.56) for electro-cardiograms.
Shepherd said theat the hospital would attempt to make refunds to patients who had paid these extra charges if the commission ordered it to.
"When we complete our audit of all the hospital's charges (which will probably take two to three more more months) we will decide what to do about money collected without authority," Reiff said. He added that he was impressed with the hospital's "voluntary," refunds.
"If you're guilty as charged you better take some action fast," he said. "The day of accountability is coming."
Shepherd said it was too sooon to tell if the loss of more then $800,000 in revenue would substantially affect the hospital's day-to-day operations.
"We're in the process of completing our annual audit," he said. "We've brought in an accountant and two consulting firms to help us. When they finish their work, we'll know what kind of effect this is going to have on the hospital."
When it has completed its audit the cost review commission has the authority to penalize the hospital for overcharges by lowering its rates.