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Iredell hospital sues patient with no job, insurance

STATESVILLE Julie Ritchie had no job and no health insurance when she was hospitalized with an ovarian cyst.

Now she faces another problem: Iredell Memorial Hospital, the Statesville hospital where she received treatment in 2008, has sued her for payment.

Julie, her husband Tim and their teenage child were living in a two-bedroom house valued at $48,000 and surviving on the money that Tim receives for Social Security disability – less than $18,000 annually. He’s bedridden from back injuries suffered during an accident in the 1980s.

“We told hospital officials time after time about our situation,” Tim Ritchie said.

The Statesville couple said they don’t recall anyone at Iredell Memorial mentioning a charity care policy, and they didn’t know to ask.

When a hospital bill for more than $13,000 arrived, “I remember … going ballistic and saying what are we going to do?” Tim said.

Collections agencies began calling. Then the hospital sued and won a judgment for the amount of the debt – plus interest and court costs.

The Ritchies were among more than 2,000 patients sued by the Statesville hospital over the past five years.

Fred Karnap, vice president of finance for the 247-bed hospital, said the hospital’s records indicate that a financial counselor gave Ritchie an application for charity care while she was in the hospital.

Later, Karnap said, the hospital sent Ritchie a certified letter stating that her account was seriously overdue and that Iredell Memorial would take legal action unless she contacted the hospital to work out a payment arrangement.

The Ritchies say they don’t remember getting the letter, and that they didn’t even realize the hospital had sued them until they were contacted by an Observer reporter. They also say they don’t recall getting a charity care application, and that Julie was delirious from pain and medication while in the hospital.

Tim Ritchie said, “13,000? We would have definitely taken advantage of that (charity care application). We would have been foolish not to.”

Karnap said he’s unsure why the charity care application was never submitted in Ritchie’s case.

But he acknowledged that more patients could qualify for charity care. About a year ago, he said, the hospital began sending its charity care application along with the legal notice before filing suit.

Iredell Memorial is more charitable than most N.C. hospitals, Karnap noted. The hospital’s current financial assistance policy, which went into place several months after Julie Ritchie was hospitalized, offers free care to uninsured patients with family income less than twice the federal poverty guideline. For an individual, that amounts to about $22,000 a year.

In 2010, the hospital spent about 5 percent of its budget on charity care. “Even with flaws, we’re apparently communicating with quite a few folks,” Karnap said.

But the hospital seeks court judgments against patients who fail to pay bills exceeding $250 and own houses and property worth more than $25,000.

“We owe it to everyone else in the community not to let those who can pay off the hook too easily,” Karnap said.

News and Observer database editor David Raynor contributed.

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