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The Consumer Financial Protection Bureau (CFPB) yesterday released a report highlighting the complicated and burdensome nature of the medical billing system in the U.S., according to a CFPB press release. The report reveals that the U.S. healthcare system is supported by a billing, payments, collections, and credit reporting infrastructure where mistakes are common, and where patients often have difficulty getting these errors corrected or resolved. “When it comes to medical bills, Americans are often caught in a doom loop between their medical provider and insurance company,” said CFPB Director Rohit Chopra. “Our credit reporting system is too often used as a tool to coerce and extort patients into paying medical bills they may not even owe.” The CFPB's report details how medical bills are often incurred through unexpected and emergency events, are subject to opaque pricing, and involve complicated insurance or charity care coverage and pricing rules. In emergency situations, patients might not even sign a billing agreement until after receiving treatment. In other instances, patients, including those with chronic illnesses or who are injured or ill, may desperately feel that the need for medical care forces them into accepting any costs for treatment. he report describes challenges and sources of confusion when a person’s medical bills go into collection or are placed on a credit report. Bills may be sent to collectors by doctors, hospitals, parent companies, or groups representing a service provider, so there may be multiple charges for the same visit. The total billed amount can quickly become unrecognizable, and the time and effort needed to parse legitimate charges from inaccurate ones can become unmanageable. Click here to read the report.

A South Jersey specialty generic pharmaceutical firm has filed a motion to convert its chapter 11 bankruptcy filing to chapter 7, a move the company said would allow it to more rapidly wind down the business, the Philadelphia Business Journal reported. Teligent Inc., in documents filed at U.S. Bankruptcy Court in Delaware, said since filing for bankruptcy in October the company has engineered three separate sales transactions that generated about $88 million in cash proceeds. Despite its "best efforts to negotiate a consensual exit" from bankruptcy, Teligent stated in its motion, discussions between the company, its committee of unsecured creditors and the company's pre-petition secured lenders have "reached an impasse and mounting expenses continue to erode value for the [the company's] stakeholders." As a result, Teligent said that it has no choice other than to request the conversion. Teligent, of Buena in Atlantic County, N.J., filed for bankruptcy protection with assets of $89 million and debts of $135.8 million.

A bankruptcy judge allowed Johnson & Johnson to use chapter 11 to drive a settlement of litigation linking its baby powder to cancer, backing a controversial tactic that has helped profitable companies freeze roughly a quarter of a million injury lawsuits, WSJ Pro Bankruptcy reported. Judge Michael Kaplan of the U.S. Bankruptcy Court in Trenton, N.J., ruled Friday against personal-injury lawyers who asked to throw out the chapter 11 filing of a J&J subsidiary created last year to move into bankruptcy about 38,000 pending lawsuits over allegedly dangerous talc-based products. Judge Kaplan ruled the subsidiary, LTL Management LLC, didn’t file for chapter 11 in bad faith to gain an unfair edge over personal-injury claimants, as they had alleged, but for the legitimate purpose of resolving mass litigation. Instead he sided with J&J, which argued chapter 11 provides cancer victims with a fairer and more efficient forum to receive compensation than the civil jury system. “This chapter 11 is being used, not to escape liability, but to bring about accountability and certainty,” Judge Kaplan said.

The three largest U.S. drug distributors and drugmaker Johnson & Johnson have agreed to finalize a proposed $26 billion settlement resolving claims by states and local governments that they helped fuel the U.S. opioid epidemic, Reuters reported. Distributors McKesson Corp., AmerisourceBergen Corp., Cardinal Health Inc. along with J&J had until Friday to decide whether enough cities and counties nationally had opted to join the landmark settlement to justify moving forward with it. The deal aims to resolve more than 3,000 lawsuits largely by state and local governments seeking to hold the companies responsible for an opioid abuse crisis that has led to hundreds of thousands of overdose deaths over the last two decades. The distributors said today that there was "sufficient participation" to proceed. Charles Lifland, an attorney for J&J, in a letter yesterday reviewed by Reuters told lawyers for the states and local governments it also had determined there had been a "sufficient resolution" of the claims. The announcement paves the way for the companies to begin making payments to the governments in April, money that officials say will be used to fund treatment and other programs aimed at addressing the health crisis.

A Mexican affiliate of Kimberly-Clark Corp. that sold hand sanitizer made with a toxic, industrial form of alcohol filed for bankruptcy, blaming the mistake on a scramble to find ingredients early in the pandemic’s supply-chain meltdown, Bloomberg News reported. 4E Brands Northamerica, a subsidiary of Kimberly-Clark de Mexico SAB de C.V., blamed its chapter 11 case on a bad batch it made from methanol alcohol near the onset of the COVID-19 outbreak in 2020. Amid a shortage of hand sanitizers, 4E Brands sought new suppliers of ethyl alcohol, a federally approved ingredient, according to court papers filed Tuesday in federal court in Laredo, Texas. The company “sourced some of its raw ingredients from opportunistic suppliers who, whether intentionally or mistakenly, provided methanol instead of ethyl alcohol,” David M. Dunn, the chief restructuring officer, said in court papers. The company now faces multiple personal injury and wrongful death lawsuits, he said. n 2020, the U.S. Food and Drug Administration reacted to a shortage of hand sanitizers by temporarily loosening restrictions on manufacturers, according to Dunn. 4E Brands ramped up production using new suppliers who sold the company the wrong type of alcohol, Dunn said in his filing. 4E Brands “did not know of the substitution. It believed ethanol was used to manufacture the hand sanitizer it distributed,” Dunn said, referring to the safer type of alcohol. “In fact, it contained methanol.”

A judge approved the sale of bankrupt Watsonville Community Hospital to a not-for-profit group that includes the California county and city where it operates, Bloomberg News reported. Bankruptcy Judge M. Elaine Hammond said during a brief hearing yesterday that she had no objections about the sale to the Pajaro Valley Healthcare District Project. The pressures of the pandemic added to years of losses at Watsonville, which lies in an agricultural area whose population has roots mostly in Latin America. The state approved the creation of the Pajaro Valley Healthcare District earlier this month, establishing an authority that can operate the facility and issue bonds. California’s 77 health-care districts are designed to provide care in under-served areas. Though the hospital was shopped and an auction was initially scheduled, no other qualified buyers submitted bids.

A Johnson & Johnson subsidiary proposed on Friday that it would submit to an independent examination of the corporate restructuring the healthcare giant undertook in an attempt to settle in U.S. bankruptcy court thousands of lawsuits alleging that J&J baby powder and other talc products cause cancer, Reuters reported. Greg Gordon, a lawyer for J&J subsidiary LTL Management LLC, raised during a hearing before U.S. Bankruptcy Judge Michael Kaplan the idea of a court-appointed examiner that could "come in and do whatever investigation it wants" to determine whether the restructuring short-changed cancer victims. Cancer plaintiffs have asked Kaplan to dismiss LTL's bankruptcy case and allow them to resume the lawsuits against J&J. Kaplan, who presided over a week-long hearing on the matter in Trenton, New Jersey, has said that he will decide by the end of the month whether to dismiss the case. J&J is attempting to use LTL's bankruptcy case to resolve about 38,000 lawsuits alleging the company's talc products caused ovarian cancer and mesothelioma, an illness linked to asbestos exposure. J&J maintains that its talc products are safe and asbestos-free, but attorneys for LTL argued that bankruptcy is the only practical way to resolve the sheer volume of lawsuits. During closing arguments in the hearing, Gordon floated the option of an independent examiner to clear the air after lawyers for cancer victims argued the bankruptcy was improper.

Family caregivers are the backbone of the nation’s long-term care system and provide an estimated $470 billion worth of free care — often at great personal cost, the Wall Street Journal reported. On average, caregivers spend 26% of their personal income on caregiving expenses, according to a 2021 AARP study, with most personal spending going to housing, including home modifications. A third of caregivers dip into their personal savings, like bank accounts, to cover costs, and 12% take out a loan or borrow from family or friends. Amy Goyer is AARP’s family and caregiving expert. She has written two books on the subject and has her own consulting business. “I am a caregiving expert. How did I end up in bankruptcy?” she says. Ms. Goyer depleted her savings and ended up relying on credit cards after being financially drained by costs related to caring for her parents. After more than a decade of caring for her mom, who had a stroke, and her dad, who had Alzheimer’s, Ms. Goyer filed for bankruptcy protection in 2019. She says it shows how the unexpected costs of daily caregiving can accumulate over time and overwhelm even the most experienced of the nation’s 53 million family caregivers. Caregiving is becoming more expensive because people are living longer with more complicated medical needs and hiring help costs more. The median annual cost of in-home care rose to $54,912 in 2020, an 18.5% increase from 2016, according to Genworth, a long-term-care insurance company.

Health care providers are increasingly choosing former stores for their offices and clinics, in a trend known as medtail — a reflection of the medical industry’s migration to retail properties, the New York Times reported. The pandemic has accelerated their embrace of retail space. Taking advantage of depressed rents, medical providers are opening facilities in storefronts on city streets and moving into malls and shopping centers in suburban and rural areas, sometimes occupying the hulking shells vacated by big-box and department stores. In the past, landlords might not have welcomed such tenants — some just didn’t want sick people around their properties, experts say — but they are increasingly seeking them out to fill vacancies and help generate foot traffic that may benefit the other occupants. This has been especially true for health care providers that brand themselves as so-called wellness companies, adopting the look and feel of consumer-oriented retailers.