American Kidney Fund tells California dialysis patients it will no longer help pay for treatments.

This article was first published on Thursday, November 14, 2019 in Kaiser Health News.

By Ana B. Ibarra

Russell Desmond received a letter a few weeks ago from the American Kidney Fund that he said felt like "a smack on the face."

The organization informed Desmond, who has kidney failure and needs dialysis three times a week, that it will no longer help him pay for his private health insurance plan — to the tune of about $800 a month.

"I am depressed about the whole situation," said the 58-year-old Sacramento resident. "I have no clue what I'm going to do."

Desmond has Medicare, but it doesn't cover the entire cost of his care.  So, with assistance from the American Kidney Fund, he pays for a private plan to cover the difference.

Now, the fund, which helps about 3,700 Californians pay their premiums and out-of-pocket costs, is threatening to pull out of California because of a new state law that is expected to cut into the dialysis industry's profits — leaving patients like Desmond scrambling.

The letter portrayed the fund as helpless. "We are heartbroken at this outcome," it read. "Ending assistance in California is the last thing we want to do."

But supporters of the new law are calling the threat a scare tactic. State Assemblyman Jim Wood (D-Healdsburg), the author of AB-290, said there is nothing in the measure that prohibits the fund from continuing to provide financial assistance to patients.

"AKF has simply made a conscious decision, without merit, to leave the state despite the many accommodations I made by amending the bill in the Senate to ensure that it can continue to operate in California," Wood said in a written statement.

What's behind this dispute is the tight relationship between the American Kidney Fund and the companies that provide dialysis, which filters the blood of people whose kidneys are no longer doing the job.

People on dialysis usually qualify for Medicare, the federal health insurance program for people 65 and older, and those with kidney failure and certain disabilities. If they're low income, they may also qualify for Medicaid, which is called Medi-Cal in California.

But dialysis companies can get higher reimbursements from private insurers than from public coverage. And one way to keep dialysis patients on private insurance is by giving them financial assistance from the American Kidney Fund, which helps nearly 75,000 low-income dialysis patients across the country.

The fund gets most of its money from DaVita and Fresenius Medical Care, the two largest dialysis companies in the country. The fund does not disclose its donors, but an audit of its finances reveals that 82% of its funding in 2018 — nearly $250 million — came from two companies.

Insurance plans, consumer advocacy groups and unions have accused the American Kidney Fund of helping dialysis providers steer patients into private insurance plans in exchange for donations from the dialysis industry. Wood said his bill is intended to discourage that practice.

American Kidney Fund CEO LaVarne Burton denied the accusations and said her group plays no role in patients' coverage choices.

Starting in 2022, the new law will limit the private-insurance reimbursement rate that dialysis companies receive for patients who get assistance from groups such as the American Kidney Fund to the rate that Medicare pays. The rate change won't apply to patients who are currently receiving assistance as long as they keep the same health plans. The bill will also address a similar dynamic in drug treatment programs.

To determine which patients receive financial aid, the law will require third-party groups to disclose patients' names to health insurers starting July 1, 2020.

These disclosure requirements are spurring the American Kidney Fund's decision to leave, Burton said. She argues that they conflict with federal rules and violate patient privacy.

"AKF has no choice but to leave or seek legal relief," Burton said.

In mid-October, the fund started sending letters to its financial aid recipients in California warning of its departure. And Nov. 1, it joined two dialysis patients in filing suit against the state, asking a U.S. District Court to rule the law unconstitutional.

Gov. Gavin Newsom cautioned against such actions when he signed the bill, and urged "both opponents and supporters to put patients first."

But as the threats and legal battle play out, patients are caught "squarely in the middle," said Bonnie Burns, a consultant with California Health Advocates, a Medicare advocacy group.

Their options may be limited, she said. Those who don't work won't have access to employer-sponsored coverage to make up the difference. And in California, Medicare recipients under age 65 are not eligible to purchase supplemental insurance known as Medigap.

The state Department of Managed Health Care offers a fact sheet for affected patients, directing them to programs such as Covered California and Medi-Cal.

DaVita and Fresenius said insurance counselors and social workers at their clinics are working with patients to find other options.

"We will continue to treat all patients, regardless of insurance status," said Paige Hosler, vice president of insurance management at DaVita. Hosler noted that some patients may qualify for DaVita's charity care program.

Dialysis companies have been at the center of recent legislative and ballot-box battles, and have spent big to defend their bottom lines. Last year, they poured a record-breaking $111 million into a campaign to defeat Proposition 8, a ballot initiative that would have capped their profits. The measure failed.

The industry also spent about $2.5 million in California on lobbying and campaign contributions in the first half of this year to oppose Wood's measure.

Desmond said he understands why lawmakers targeted the dialysis industry but can't fathom why they did so at the expense of patients.

Desmond was laid off from his job as a computer programmer in Massachusetts in 2009 and moved to California to join his brother. One year later, he was diagnosed with kidney failure.

He lives off his Social Security Disability Insurance benefits, which come to about $2,000 a month after his Medicare premiums are deducted. Medicare pays for 80% of his care.

He also qualifies for Medi-Cal coverage that comes with high out-of-pocket costs, so he relies instead on a private Aetna insurance plan to cover the remaining 20%. The American Kidney Fund has been paying the premiums for his private plan since 2015.

"What they did is take away our life raft and left us to drown," he said of lawmakers.

Brian Carroll, 40, of Sacramento, has been on dialysis for five years. He moved back in with his parents in 2016 because, he said, dialysis left him too weak to work.

"I am now completely depending on other people," Carroll said. The American Kidney Fund pays the $270 monthly premium for his private insurance plan that covers what Medicare doesn't. "That's an entire month of groceries and gas for me," he said.

Carroll said he supported Proposition 8, even though dialysis companies argued it would force them to cut back services and shut down clinics.

In this situation, he's not sure whom to blame — the lawmakers, who passed the law with no backup plan for patients, or the fund, which is essentially holding patients hostage.

"What I do know is that you can't just leave dialysis patients like this," Carroll said. "It's cruel."

This KHN story first published on California Healthline, a service of the California Health Care Foundation.

Ana B. Ibarra: aibarra@kff.org, @ab_ibarra

Critics say the nonprofit health system is becoming more like its for-profit counterparts.

This article was first published on Friday, November 8, 2019 in Kaiser Health News.

By Anna Almendrala

Kaiser Permanente, which just narrowly averted one massive strike, is facing another one Monday.

The ongoing labor battles have undermined the health giant's once-golden reputation as a model of cost-effective care that caters to satisfied patients — which it calls "members" — and is exposing it to new scrutiny from politicians and health policy analysts.

As the labor disputes have played out loudly, ricocheting off the bargaining table and into the public realm, some critics believe that the nonprofit health system is becoming more like its for-profit counterparts and is no longer living up to its foundational ideals.

Compensation for CEO Bernard Tyson topped $16 million in 2017, making him the highest-paid nonprofit health system executive in the nation. The organization also is building a $900 million flagship headquarters in Oakland. And it bid up to $295 million to become the Golden State Warriors' official health care provider, the San Francisco Chronicle reported. The deal gave the health system naming rights for the shopping and restaurant complex surrounding the team's new arena in San Francisco, which it has dubbed "Thrive City."

The organization reported $2.5 billion in net income in 2018 and its health plan sits on about $37.6 billion in reserves.

Against that backdrop of wealth, more than 80,000 employees were poised to strike last month over salaries, retirement benefits and concerns over outsourcing and subcontracting. Nearly 4,000 members of its mental health staff in California are threatening to walk out Monday over the long wait times their patients face for appointments.

"Kaiser's primary mission, based on their nonprofit status, is to serve a charitable mission," said Ge Bai, associate professor of accounting and health policy at Johns Hopkins University. "The question is, do they need such an excessive, fancy flagship space? Or should they save money to help the poor and increase employee salaries?"

Lawmakers in California, Kaiser Permanente's home state, recently targeted it with a new financial transparency law aimed at determining why its premiums continue to increase.

There's a growing suspicion "that these nonprofit hospitals are not here purely for charitable missions, but instead are working to expand market share," Bai said.

The scrutiny marks a disorienting role-reversal for Kaiser, an integrated system that acts as both health insurer and medical provider, serving 12.3 million patients and operating 39 hospitals across eight states and the District of Columbia. The bulk of its presence is in California. (Kaiser Health News, which produces California Healthline, is not affiliated with Kaiser Permanente.)

Many health systems have tried to imitate its model for delivering affordable health care, which features teams of salaried doctors and health professionals who work together closely, and charges few if any extraneous patient fees. It emphasizes caring and community with slogans like "Health isn't an industry. It's a cause," and "We're all in this together. And together, we thrive."

Praised by President Barack Obama for its efficiency and high-quality care, the health maintenance organization has tried to set itself apart from its profit-hungry, fee-for-service counterparts.

Now, its current practices — financial and medical — are getting a more critical look.

As a nonprofit, Kaiser doesn't have to pay local property and sales taxes, state income taxes and federal corporate taxes, in exchange for providing "charity care and community benefits" — although the federal government doesn't specify how much.

As a percentage of its total spending, Kaiser Permanente's charity care spending has decreased from 1.29% in 2012 to 0.8% in 2017. Other hospitals in California have exhibited a similar decrease, saying there are fewer uninsured patients who need help since the Affordable Care Act expanded insurance coverage.

CEO Tyson told California Healthline that he limits operating income to about 2% of revenue, which pays for things like capital improvements, community benefit programs and "the running of the company."

"The idea we're trying to maximize profit is a false premise," he said.

The organization is different from many other health systems because of its integrated model, so comparisons are not perfect, but its operating margins were smaller and more stable than other large nonprofit hospital groups in California. AdventHealth's operating margin was 7.15% in 2018, while Dignity Health had losses in 2016 and 2017.

Tyson said that executive compensation is a "hotspot" for any company in a labor dispute. "In no way would I try to justify it or argue against it," he said of his salary. In addition to his generous compensation, the health plan paid 35 other executives more than $1 million each in 2017, according to its tax filings.

Even its board members are well-compensated. In 2017, 13 directors each received between $129,000 and $273,000 for what its tax filings say is five to 10 hours of work a week.

And that $37.6 billion in reserves? It's about 17 times more than the health plan is required by the state to maintain, according to the California Department of Managed Health Care.

Kaiser Permanente said it doesn't consider its reserves excessive because state regulations don't account for its integrated model. These reserves represent the value of its hospitals and hundreds of medical offices in California, plus the information technology they rely on, it said.

Kaiser Permanente said its new headquarters will save at least $60 million a year in operating costs because it will bring all of its Oakland staffers under one roof. It justified the partnership with the Warriors by noting it spans 20 years, and includes a community gathering space that will provide health services for both members and the public.

Kaiser has a right to defend its spending, but "it's hard to imagine a nearly $300 million sponsorship being justifiable," said Michael Rozier, an assistant professor at St. Louis University who studies nonprofit hospitals.

The Service Employees International Union-United Healthcare Workers West was about to strike in October before reaching an agreement with Kaiser Permanente.

Democratic presidential candidates Kamala Harris, Bernie Sanders, Elizabeth Warren and Pete Buttigieg, as well as 132 elected California officials, supported the cause.

California legislators this year adopted a bill sponsored by SEIU California that will require the health system to report its financial data to the state by facility, as opposed to reporting aggregated data from its Northern and Southern California regions, as it currently does. This data must include expenses, revenues by payer and the reasons for premium increases.

Other hospitals already report financial data this way, but the California legislature granted Kaiser Permanente an exemption when reporting began in the 1970s because it is an integrated system. This created a financial "black hole" said state Sen. Richard Pan (D-Sacramento), the bill's author.

"They're the biggest game in town," said Anthony Wright, executive director of the consumer group Health Access California. "With great power comes great responsibility, and a need for transparency."

Patient care, too, is under scrutiny.

California's Department of Managed Health Care fined the organization $4 million over mental health wait times in 2013, and in 2017 hammered out an agreement with it to hire an outside consultant to help improve access to care. The department said Kaiser Permanente has so far met all the requirements of the settlement.

But according to the National Union of Healthcare Workers, which is planning Monday's walkout, wait times have just gotten worse.

Tyson said mental health care delivery is a national issue — "not unique to Kaiser Permanente." He said the system is actively hiring more staff, contracting with outside providers and looking into using technology to broaden access to treatment.

At a mid-October union rally in Oakland, therapists said the health system's billions in profits should allow it to hire more than one mental health clinician for every 3,000 members, which the union says is the current ratio.

Ann Rivello, 50, who has worked periodically at Kaiser Permanente Redwood City Medical Center since 2000, said therapists are so busy they struggle to take bathroom breaks and patients wait about two months between appointments for individual therapy.

"Just take $100 million that they're putting into the new 'Thrive City' over there with the Warriors," she said. "Why can't they just give it to mental health?"

Anna Almendrala: aalmendrala@kff.org, @annaalmendrala

Medicaid has avoided the march toward digital communication and continues to operate largely in a paper-based world.

This article was first published on Monday, November 4, 2019 in Kaiser Health News.

By Markian Hawryluk

COLORADO SPRINGS, Colo. — Forty-two boxes of returned mail lined a wall of the El Paso County Department of Human Services office on a recent fall morning. There used to be three times as many.

Every week, the U.S. Postal Service brings anywhere from four to 15 trays to the office, each containing more than 250 letters that it could not deliver to county residents enrolled in Medicaid or other public assistance programs. This plays out the same way in counties across the state. Colorado estimates about 15% of the 12 million letters from public assistance programs to 1.3 million members statewide are returned — some 1.8 million pieces of undelivered mail each year.

It falls on each county's staff, in between fielding calls, to contact the individuals to confirm their correct address and their eligibility for Medicaid, the federal-state health insurance program for people with low incomes.

But last year, state officials decided that if caseworkers can't reach recipients, they can close those cases and cut off health benefits after a single piece of returned mail.

Medicaid, food stamps and other public benefit programs have avoided the march toward digital communication and continue to operate largely in a paper-based world. That essentially ties lifesaving benefits for some of the most vulnerable populations to the vagaries of the Postal Service.

As returned mail piles up, Colorado and other states take increasingly drastic measures to work through the cumbersome backlog, lowering the bar for canceling benefits on the basis of returned mail alone. Missouri, Oklahoma and Maryland are among those that have struggled with the volume. And when Arkansas implemented Medicaid work requirements, nearly half of the people who lost benefits had failed to respond to mailings or couldn't be contacted.

At best, tightening returned mail policies could save states some money, and those cut from the benefits yet still eligible for them would experience only a temporary gap in their care. But even short delays can exacerbate some patients' chronic health conditions or lead to expensive visits to the hospital.

And at worst, the returned mail may be contributing to a major drop in Medicaid enrollment and increased numbers of uninsured. Those dropped from the rolls rarely realize it until they seek care.

"There's a lot of concern on this issue," said Ian Hill, a health policy analyst at the Urban Institute, a think tank based in Washington, D.C. "Are they getting purged from the records unfairly and too quickly?"

Taking Action

States have been walking a tightrope. While trying to aid their poorest residents, they also are grappling with budget-busting Medicaid costs and pressure from the Trump administration to ensure everyone on public assistance programs qualifies for the benefits.

Some states have sought "procedural denials because it kept their costs down," said Cindy Mann, who ran the Medicaid program under the Obama administration.

"But we certainly don't want to cut somebody off while they're still eligible," said Mann, who is now a partner with the law firm Manatt, Phelps & Phillips. "It's penny-wise and pound-foolish."

Low-income families who depend on public benefits tend to move often, leading to frequent errors in the addresses on file. But if a person moves out of state, the state-administered Medicaid benefit cannot move with them.

"States have always struggled with how to handle returned mail," said Jennifer Wagner, a senior policy analyst with the Center on Budget and Policy Priorities, a left-leaning think tank in Washington, D.C. "But we have more recently heard of states pushing a policy to be very aggressive about canceling clients when the state receives returned mail, and that has led to significant disenrollment."

In April 2018, Colorado lowered its recommended threshold for acting upon returned mail from three pieces of undeliverable mail to just one. From May 2017 to May 2019, enrollment in Medicaid and the Children's Health Insurance Program dropped 8.5% in the state — more than three times the national decline of 2.5%, according to the Medicaid and CHIP Payment and Access Commission, a congressional advisory panel.

It's unclear how much of the drop was due to returned mail. The enrollment declines could also reflect some combination of a proposed federal rule to deny green cards to immigrants who use public benefits, cuts in federal funding for outreach to sign people up for health coverage or an improved economy.

Colorado has not set up a way of tracking how many people are losing benefits because of returned mail or what happens to those who do.

"We don't have one data point that we can track," said Marivel Klueckman, who oversees Medicaid eligibility functions for Colorado. "That is something we're building into the future."

Of the more than 131,000 Colorado households that have public benefit mail returned each year, the state estimates about 1 in 4 cannot be reached, resulting in the possible closure of nearly 33,000 cases.

People cut off from benefits may never learn why and may not seek to restore their benefits, which concerns Bethany Pray, health care program director at the Colorado Center on Law and Policy, a Denver-based legal aid group.

"You're going to lose people who are truly eligible and should never have been taken off and who face barriers to re-enrollment," Pray said.

Mailing Woes 

The lack of dependability of the Postal Service, particularly in rural areas of the state, adds to the concerns about relying on snail mail for important government correspondence.

Officials from the ski resort town of Snowmass Village, for example, complained last spring that they didn't have any mail delivered for an entire week.

"We have received over 6 feet of snow in the last two weeks and we still get more complaints about postal delivery than snow removal," town officials wrote in a March survey conducted by the Colorado Association of Ski Towns. "People aren't getting bills, jury summons, medications, certified mail."

In June, three members of Colorado's congressional delegation sent a letter to the postmaster general, pressing her to address a range of postal issues including lost or returned mail.

There's no question that cutting off people after one piece of paper mail is returned saves the state money in sending letters and processing undeliverable mail — though other costs may add up later. Colorado public assistance programs mail more than a million letters each month, at a cost of nearly $6 million annually. That is a small share of what is spent on the actual assistance, given that Colorado's Medicaid program alone costs $9 billion a year.

Cutting off assistance after one piece of returned mail also helps the state avoid making monthly payments to regional health organizations for case management and dental services for those who no longer qualify for benefits.

However, Colorado Medicaid's Klueckman said the state is primarily concerned with making sure eligible residents get their notifications and remain enrolled. The state moved eligibility determinations and renewals online and now offers a mobile app so residents also can receive notifications electronically.

Local Discretion 

Colorado plans to open a consolidated returned mail center for the state as soon as July 2020. That could provide some economies of scale and consistency, but has the potential of increasing the number of people dropped, as local knowledge is replaced by automation.

Counties currently receive guidance from the state on how to process returned mail, but they have leeway to set their own procedures. El Paso County, for example, rarely closes cases based on a single piece of returned mail and opts not to act on addresses that are often used by those who are homeless, such as a shelter or post office.

"They're the least likely for us to be able to have a phone number to call them," said Karen Logan, economic and administrative services director for the county.

The county, Colorado's second-largest, used grant money this year to pay staff overtime to whittle down its backlog of returned mail. That has helped the county process more than 48,000 pieces of returned mail in the past year, with more than a third prompting database changes. But officials could not say how many of those resulted in people losing benefits.

"We have some other things that are a little bit higher on the priority scale, so we don't close as many cases as we probably could," Logan said. "But I can tell you this: Closing a case and having a person have to reapply two months later takes significantly more work."

Markian Hawryluk: MarkianH@kff.org, @MarkianHawryluk

Hundreds of hospitals have joined in a handful of lawsuits in state courts as their best hope for winning meaningful settlement money.

This article was first published on Tuesday, October 29, 2019 in Kaiser Health News.

By Blake Farmer, Nashville Public

While thousands of cities and counties have banded together to sue opioid makers and distributors in a federal court, another group of plaintiffs has started to sue on their own: hospitals.

Hundreds of hospitals have joined in a handful of lawsuits in state courts, seeing the state-based suits as their best hope for winning meaningful settlement money.

"The expense of treating overdose and opioid-addicted patients has skyrocketed, straining the resources of hospitals throughout our state," said Lee Bond, CEO of Singing River Health System in Mississippi in a statement. His hospital is part of a lawsuit in Mississippi.

Hospitals may discover downsides to getting involved in litigation, said Paul Keckley, an independent health analyst.

"The drug manufacturers are a soft target," he said. But the invasive nature of litigation may generate "some unflattering attention" for hospitals, he added. They'd likely have to turn over confidential details about how they set prices, as well as their relationships with drug companies.

So, despite representing the front lines of the opioid epidemic, most hospitals have been hesitant to pile on.

Just about every emergency room has handled opioid overdoses, which cost hospitals billions of dollars a year, since so many of the patients have no insurance. But that's just the start. There are also uninsured patients, like Traci Grimes of Nashville, who end up spending weeks being treated for serious infections related to their IV drug use.

"As soon as I got to the hospital, I had to be put on an ice bath," Grimes said of her bout with endocarditis over the summer, when bacteria found its way to her heart. "I thought I was going to die, literally. And they said I wasn't very far away from death."

Grimes is in recovery from her opioid addiction but still getting her energy back after spending a month being treated through a special intravenous line to her heart at Vanderbilt University Medical Center. Most patients could be sent home with a PICC line, but not someone with a history of illicit IV drug use who could misuse it to inject other substances. Vanderbilt and other academic medical centers recognize the problem and have established special clinics to manage these complex patients.

Grimes, 37, said she's grateful for the care she received, which included multiple procedures and treatment for pneumonia, hepatitis A and hepatitis C. But like most patients in her situation, she's uninsured and strapped for cash.

"I can't pay a thing. I don't have a dime," she said. "So they do absorb all that cost."

Hospitals estimate treating complicated patients like Grimes costs an average of $107,000 per person, according to court documents. The total costs to U.S. hospitals in one year, 2012, exceeded $15 billion, according to a report cited in the suits. And most patients either couldn't pay or were covered by government insurance programs.

The expense is a leading reason cited by the hospitals who've banded together in a handful of lawsuits in Tennessee, Texas, Arizona, Florida, Kentucky, Mississippi and West Virginia. These suits are separate from the consolidated federal case in Ohio that includes cities and counties around the country. But the most prominent hospitals in those states, like Vanderbilt, have opted not to join the litigation.

West Virginia University President E. Gordon Gee, who oversees the state's largest hospital system, has been urging others to join the suits. He and former Ohio Gov. John Kasich established an organization meant to highlight the harm done to hospitals by the opioid crisis.

"I think the more hospitals we have that want to be involved in this in some way, the better off we are," he said. "You know, there's always safety in mass."

By "safety," Gee acknowledged a central concern for hospitals weighing the risk versus reward of going to court. They may have the tables turned on them by the pharmaceutical companies since, until recently, patients in the hospital were often prescribed large quantities of opioids, contributing to the epidemic.

"I suspect there are some hospitals … who are afraid that if they get into it, those who are on the defense side will point out, well, maybe hospitals were really the problem," he said.

The lead defendant in the suits, Purdue Pharma, did not respond to requests for comment.

Gee said hospitals can claim they were victims of dubious opioid marketing.

Still, many high-profile hospitals are sitting out the lawsuits, even though they're typically the ones that treat the most complicated and expensive patients.

Health analyst Keckley said if hospitals join the litigation, they may be forced to cough up actual totals for their opioid-related financial damages. That could force hospitals to reveal how much more they charge for some services, compared with the actual costs of providing the care.

"Hospitals basically have charged based on their own calculations and the underlying cost of delivering that care has been virtually nontransparent," Keckley said. "Then you open a whole new can of worms."

Big academic medical centers especially, Keckler said, have relationships with drugmakers that they may not want publicly highlighted.

Still, hospitals might benefit without having to put their names on lawsuits and exposing themselves to risk. In Oklahoma, the state won an early opioid lawsuit in August. The payout does not direct money to hospitals, per se. However, Patti Davis, president of the Oklahoma Hospital Association, said they're happy to see some of the money was earmarked for treatment.

"When we see treatment, we get very excited because it's our hospitals providing a lot of the treatment," she said.

But nationally, hospitals can't count on potential settlement money to trickle down to their bottom lines, said Don Barrett, a Mississippi litigator helping hospitals sue in state courts.

Two decades ago, when the target of litigation was Big Tobacco, Barrett was working for states. He said hospitals didn't join in, to his surprise. And when the states won those suits and started getting paid damages, hospitals missed out. Only about a third of the money was even spent on health or tobacco control, according to one watchdog's estimate.

"I guess they thought that the states were going to take care of them, that these local governments were going to take this money and give it to the hospitals where it would do some good," he said. "Of course, they didn't give them a damn penny."

Some states did set up trust funds that might help patients in the hospital stop smoking. But many are using the money to fill potholes, pay teachers and otherwise close gaps in state budgets.

Though not detailed in the lawsuits, many of the participating hospitals are in varying levels of financial distress, and not always primarily because of the opioid epidemic. Facilities owned by Community Health Systems make up a large share of the hospitals suing in Alabama, Florida, Mississippi, Tennessee and Texas. The investor-owned hospital chain, based in Franklin, Tenn., has been struggling mostly because of an outsize debt load taken on during a rapid period of expansion.

A CHS spokesperson declined to comment, citing a policy not to talk about pending litigation.

But Barrett said he expects more hospitals to join the cause rather than relying on states to determine how settlement money is spent.

"We're not going to allow that to happen this time," he said. "We can't afford to allow it to happen this time."

This story is part of a partnership that includes Nashville Public Radio, NPR and Kaiser Health News.

Blake Farmer, Nashville Public Radio: bfarmer@wpln.org, @flakebarmer