The spotlight on how healthcare facilities collect on unpaid medical debts continues to intensify, with a new report from The New York Times questioning why more lawsuits are being filed against individuals who do not pay their bills and how lawmakers are now looking into solutions that would provide consumers with additional protections.
Higher deductibles is the primary cause that is leading more individuals to be discharged from hospitals or walk out of their doctor’s offices with unpaid bills, and healthcare providers acknowledge they are only suing as a last resort and only suing those who they believe have the means to repay the debt but have not done so.
Consumer advocates argue that healthcare facilities are not making accurate determinations about an individual’s ability to repay and are big too aggressive in using the legal system to seek repayment. Too many individuals purchased their own healthcare policies without fully understanding what they were buying, patient advocates reported.
“There are some people who bought their own insurance, and simply didn’t understand the limits of what they were paying for,” said Jessica Roulette, a lawyer with Legal Action of Wisconsin. “We see medical debt collection against people who have purchased marketplace plans that don’t seem to cover a whole lot.”
Lawmakers are also taking notice. In New York, for example, bills have been introduced that would reduce the statute of limitations on collecting unpaid medical debts, according to the published report. The statute would be reduced to two years, from six, and the interest rate on unpaid medical debts would be capped at 3%, from 9% currently.
Individuals quoted in the article talked about having to choose between paying the rent or paying the electric bill because their wages are being garnished over unpaid medical debts.
“You sit there, and you’re so stressed out that you start crying, and your own daughter offers her change jar to you. What kind of person does that make me?”
While nobody from the credit and collection industry was quoted in the article, it did quote a spokesman from a healthcare provider in West Virginia, who said:
“We’re a health care system that has to pay bills,” Mr. Keck said. “We have to pay nurses and doctors and so on. We’re doing everything possible to keep things out of court, because it’s expensive for everybody.”