Last year as COVID-19 laid siege to the nation, many U.S. hospitals dramatically reduced their aggressive tactics to collect medical debt. Some ceased entirely.
But not all.
There was a nearly 90% drop overall in legal actions between 2019 and the first seven months of 2020 by the nation’s largest hospitals and health systems, according to a new report by Johns Hopkins University. Still, researchers told ProPublica that they identified at least 16 institutions that pursued lawsuits, wage garnishments and liens against their patients in the first seven months of 2020.
The Johns Hopkins findings, released Monday in partnership with Axios, which first reported the results, are part of an ongoing series of state and national reports that look at debt collections by U.S. hospitals and health systems from 2018 to 2020.
During those years more than a quarter of the nation’s largest hospitals and health systems pursued nearly 39,000 legal actions seeking more than $72 million, according to data Johns Hopkins researchers obtained through state and county court records.
More than 65% of the institutions identified were nonprofit corporations, which means that in return for tax-exempt status they are supposed to serve the public rather than private interest.
The amount of medical debt individuals owe is often a small sliver of a hospital’s overall revenue — as little as 0.03% of annual receipts — but can “cause devastating financial burdens to working families,” the report said. The federal Consumer Financial Protection Bureau has estimated medical debt makes up 58% of all debt collection actions.
The poor or uninsured often bear the brunt of such actions, said Christi Walsh, clinical director of health care and research policy at Johns Hopkins University. “In times of crisis you start to see the huge disparities,” she said.
Researchers said they could not determine all of the amounts sought by the 16 institutions taking legal action in the first half of 2020, but of those they could, Froedtert Health, a Wisconsin health system, sought the most money from patients — more than $3 million.
Even after Wisconsin Gov. Tony Evers declared a public health emergency on March 12, 2020, hospitals within the Froedtert Health system filed more than 100 cases from mid-March through July, researchers reported, and 96 of the actions were liens.
One lien was against Tyler Boll-Flaig, a 21-year-old uninsured pizza delivery driver from Twin Lakes, Wisconsin, who was severely injured June 3, 2020, when a speeding drag racer smashed into his car. Boll-Flaig’s jaw was shattered, and he had four vertebrae crushed and several ribs broken. His 14-year-old brother, Dominic Flaig, tagging along that night, was killed.
Days after the crash, their mother, Brandy Flaig, said she got a call from a hospital billing office asking for her surviving son’s contact information to set up a payment plan for his medical bills.
Then on July 30 — less than two months later — Froedtert Hospital in Milwaukee filed a $67,225 lien against Boll-Flaig. It was one of seven liens the hospital filed the same day, totaling nearly a quarter of a million dollars, according to the Wisconsin Circuit Court Access website used by researchers and reviewed by ProPublica.
“It’s during the pandemic, we’re still grieving, and they go after Tyler?” Flaig said. “It’s predatory.” Tyler Boll-Flaig declined to be interviewed.
