Although critics nationwide have called on large hospital systems to stop suing patients, there’s little indication many are listening.
Most of the nation’s largest 20 hospital systems allow their hospitals to file lawsuits and liens against their patients, the Observer found.
No group or agency tracks how often hospitals sue patients. But some experts suspect such suits are on the rise.
Mark Schiffman, spokesman for a trade group that represents collection agencies, says he thinks U.S. hospitals are filing more lawsuits now than they did a decade ago.
Among the reasons: The sour economy has left more patients facing debt collection. More have also become aware of their rights under federal law and are telling debt collectors to stop contacting them. At the same time, the increasing use of caller ID has made it easier for consumers to dodge calls from collectors.
“If you’re not talking to me, you’re leaving me with no other alternative (but to pursue legal action),” said Schiffman, who works for ACA International. “It’s not the desired approach. We want to talk to consumers.”
In 2004, class-action lawyers filed suits alleging that a number of U.S. hospital chains were overcharging uninsured patients and using unfair collection tactics. Since then, some states have put limits on what hospitals can do to collect.
In California, for instance, hospitals are barred from seizing a “financially qualified” patients’ wages or placing a lien on their primary residences.
Some hospital systems have put in place their own restrictions. As part of its “compact with uninsured patients,” for-profit Tenet Healthcare Corp. has pledged not to pursue legal action against patients who are unemployed or without other significant income.
The Dallas-based system has also agreed not to file lawsuits if the only recovery available would be to place a lien on the patient’s home.
The compact grew out of a legal settlement Tenet reached with patients who accused the company of using unfair billing and collection practices against the uninsured.
Pittsburgh-based UPMC says it doesn’t sue patients or put liens on their homes.
“We felt that it was a very strong hand to play,” said April Langford, the hospital chain’s vice president in charge of patient financial services.
The new federal health care law may also lead to tighter controls on collections.
Under rules proposed by the U.S. Treasury Department, patients would get at least four months to apply for financial help before nonprofit hospitals can turn them over to collection agencies or file lawsuits.
The rules seek to clarify the responsibilities of nonprofit hospitals under the federal Affordable Care Act.