KHN Investigation Finds Hospitals Suing Patients for Medical Debts

Medical bills can ridiculously pile up, especially in the United States. On average, an emergency room visit can cost over $2,000, which is easily over people's budget. Regardless of medical debt and its negative impact on many individuals, U.S. hospitals continue to bill patients using lawsuits or even disclosing them to credit reporting agencies.

What did KHN’s investigation find?

A KHN investigation reveals that despite the unethical distress caused by medical debt to many patients, U.S. hospitals are persistently asking, or even threatening patients to pay their bills by using lawsuit tactics and reporting them to credit rating agencies. Turning patients to debt collection practices are habitual among many types of hospitals across the United States, from public university hospitals to small community hospitals, and even nonprofit Catholic medical systems.

Around 5,100 hospitals across the nation have used legal practices or other lawsuit tactics against patients for their incredibly-high medical debt. Despite some industry officials claiming they are cautious about their marked patients, some places have rejected "extraordinary collection actions" to reduce food and other necessities from patients to make up for their bills.

Many hospitals examined by KHN hid their debt collection activities and posted incomplete or no information about what may happen to patients if their medical bills rise. KHN continued to investigate medical institutions throughout the year, with over 528 hospitals and pages of documents to review. From their study, it was revealed that hospitals sometimes give an absurd amount of medical bills or even place them at legal risks that can hinder their ordinary lives.

To continue, KHN found that more than 66 percent of patients have some type of legal action against them. Many also have outstanding medical bills reported to credit agencies, hindering their rights to rent an apartment, get a car, or even get a career. Around 25 percent of patients' medical debts were also sold to debt collectors, meaning they can now go after patients for years for their medical bills. To continue, around 1 in 5 refuse non-emergency care to patients with outstanding medical debt. KHN also revealed that around 40 percent of hospitals have no information on their websites regarding debt collection activities.

“People don’t know what’s going to happen to them. It can be terrifying,” said a Los Angeles consumer attorney at Bet Tzedek Legal Services Tracy Douglas. She said one older woman she previously worked with was scared to ask for financial aid from a hospital as she was concerned the hospital would take over her home if she couldn’t pay her bills.

Millions of people across the U.S. are in medical debt

Medical debt and absurdly high medical bills are hindering Americans from living their ordinary lives, blocking a simple trip to the hospital. Without insurance, even a simple check-up at the hospital can cost approximately anywhere between $200-$600.

Yoona Park, a newly-hired data scientist who recently moved from South Korea, had to stay home when she got infected with COVID-19 despite her serious symptoms because she was scared of hospital bills. “I don’t have health insurance yet as I just got hired. In Korea, I would just walk to my local doctor’s office and pay about $5 to get prescribed some medications and a quick check-up. Here, I didn’t know what to do other than stay home because I can’t afford hospital bills,” said Park to Healthnews.

"I was confused when I got to America because even without health insurance in Korea, a visit to the doctor's office usually costs around $20. I once heard a receptionist apologize to a foreign patient at the optometrist because, without insurance, her bill came up to like $25, which is considered expensive in Korea."

These two individuals are among millions of individuals in the U.S. suffering from the horrific medical system. "Debt is no longer just a bug in our system. It is one of the main products,” said the founder and president of HealthBegins Dr. Rishi Manchanda. “We have a health care system almost perfectly designed to create debt."

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