Hospital Network Announces Changes to Collection Policies

After being called out for filing lawsuits against individuals who did not pay their healthcare debts, Methodist Le Bonheur Healthcare in Memphis, Tenn., has announced it will no longer pursue legal options against individuals who make less than 250% of the federal poverty guidelines.

The healthcare company also announced it will raise the threshold for individuals who are eligible for financial assistance from those who make 125% of the federal poverty guidelines to those who make 250%.

The current poverty line is $12,490 for one person and goes up by $4,420 for each additional individual living in a home.

“Our updated policy will better reflect the needs and circumstances of those we serve. More importantly it will help us better care for all members of the community. With our revised policy, families of three with a household income of $53,325 or less, will have access to financial assistance. This represents more than half of the population of greater Memphis,” Michael Ugwueke, President and CEO, Methodist Le Bonheur Healthcare, in a statement.

Methodist Le Bonheur Healthcare was the second-most prolific filer of lawsuits against individuals for unpaid debts between 2014 and 2018 — filing more than 8,300 — according to the initial report. Methodist owns its own collection agency — Consolidated Recovery Systems, a unit of Revenue Assurance Professionals.

On those individuals it does choose to sue, the hospital said it would no longer accept court-ordered interest on medical debt and will no longer collect court-allowed attorney fees or court costs from any patient, the company announced.

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