The University of Virginia this week said it is working on ways to make healthcare more affordable at its facilities, but stopped short of saying it will stop pursuing medical debt suits against patients. The statement came on the heels of a pledge by VCU Health earlier this week that it would no longer pursue legal action in order to collect medical debts.
Last month, UVa announced that it will adjust its financial aid guidelines in order to offer free and low-cost care to more patients in the wake of a report by Kaiser Health News that found that it had sued patients 36,000 times for more than $106 million from 2013 to June 2018. In the weeks since the report, the university has non-suited — meaning a case is dismissed but could be brought again at a future date — a slew of cases in Albemarle County General District Court.
UVa has not, however pledged to halt all lawsuits against patients, claiming a state agencies are legally required to collect unpaid bills, something it plans to advocate the General Assembly changes.
As part of a new policy prompted by the KHN report, UVa plans to file lawsuits against patients who earn more than 400% of the federal poverty level (an annual income of $103,000 for a family of four) and owe more than $1,000 to the hospital.
“The changes we announced a few weeks ago were a first step, and we are continuing to thoughtfully review our billing and collection practices to find additional ways to better serve our patients as well as improve fairness and transparency,” UVa hospital spokesman Eric Swensen wrote Thursday in a statement following VCU Health’s announcement. “We are looking at all options in achieving these goals.”
VCU Health, Richmond’s major medical system which includes the largest teaching hospital in the state, said it will no longer file lawsuit against its patients in order to collect medical debt, issue new garnishments on wages or put new liens on homes.
Additionally, starting next month VCU will write off 100% of charges for patients with incomes under 200% of the federal poverty level, which is roughly $25,000 for an individual and will write off 50% of the charges for patients with incomes between 201-300% of the federal poverty level, which is roughly $37,000 for an individual.
“We stopped using legal action for debt collection at VCU Medical Center many years ago. Now our other facilities are doing the same,” an online statement from VCU reads. “We are discussing several possibilities regarding older patient accounts that are already in court, and how to manage outstanding wage garnishments and liens.”
VCU’s in-house physician group filed more than 56,000 lawsuits against patients for $81 million over the seven years ending in 2018, according to a Kaiser Health News analysis of district court data.
UVa’s new financial assistance guidelines represent a first step, according to the university, which also plans to form a working group to address the issue, improve its price transparency tools and address specific concerns of UVa students and staff who have had wages garnished or enrollments put on hold due to medical bills.
However, some experts have taken issue with UVa’s claims that they are legally obligated to collect medical debt, especially in the wake of VCU’s announcement.
“The majority of hospitals have never filed a lawsuit against a patient to collect debt,” said Marty Makary, a professor of surgery at Johns Hopkins University. “Part of the public trust is that doctors treat anyone regardless of race, religion or ability to pay.”
Makary, author of the recent book “The Price We Pay,” is also an author of a recent study that found that four nonprofit and one for-profit Virginia hospitals are responsible for 51% of garnishment cases in the state in 2017. He and a team of doctors and lawyers investigated Mary Washington Healthcare in Fredericksburg earlier this year; within a day of an NPR report detailing the number of cases the hospital brought in local courts, the hospital said it would suspend its practice of suing patients for unpaid bills.
“We’re calling on all UVa alumni to let the university know they’re not OK with these predatory billing practices,” he said. “Hospitals should have compassion for people who cannot pay their medical bills, to sue them and put liens on their homes is disgraceful.”