The Nonprofit Hospital That Makes Millions, Owns a Collection Agency and Relentlessly Sues the Poor

Source: Wendi C. Thomas, MLK50 & ProPublica, June 27, 2019

Nonprofit hospitals pay virtually no local, state or federal income tax. In return, they provide community benefits, including charity care to low-income patients. In Memphis, Methodist Le Bonheur Healthcare has brought 8,300 lawsuits for unpaid medical bills in just five years. ….. Its own employees are no exception. Since 2014, Methodist has sued dozens of its workers for unpaid medical bills, including a hospital housekeeper sued in 2017 for more than $23,000. That year, she told the court, she made $16,000. She’s in a court-ordered payment plan, but in the case of more than 70 other employees, Methodist has garnished the wages it pays them to recoup its medical charges….

Related:
This Memphis Hospital System Flouts IRS Rules by Not Publicly Posting Financial Assistance Policies
Source: Wendi C. Thomas, MLK50 & ProPublica, June 27, 2019

Nonprofit hospitals must post financial assistance policies for the public to see, including in emergency rooms. But Methodist Le Bonheur Healthcare’s five Shelby County emergency rooms had no signs or displays when a reporter checked.

Prevalence and Characteristics of Virginia Hospitals Suing Patients and Garnishing Wages for Unpaid Medical Bills
Source: William E. Bruhn, Lainie Rutkow, Peiqi Wang, Stephen E. Tinker, BS3; Christine Fahim, Heidi N. Overton, Martin A. Makary, JAMA, Research Letter, June 25, 2019

An estimated 20% of US consumers had medical debt in collections in 2014. Medical debt has been increasing with direct patient billing, rising insurance deductibles, and more out-of-network care being delivered, even at in-network facilities. Bills sent directly to patients may use the undiscounted price of a hospital’s services and can result in financial hardship and avoidance of future medical care. Hospitals need to be paid for care delivered, but some bills are unpaid. Hospitals may negotiate, reduce, or write off payments. Some have begun adopting a range of aggressive strategies for collecting unpaid bills, including suing patients and garnishing their wages or bank savings. We examined garnishment legal actions among Virginia hospitals.