N.Y. Hospital Rescinds Collection Lawsuits After Report Cites ‘Flood’ of Litigation

The largest hospital network in New York has decided to rescind lawsuits it filed against patients in 2020 and will pause any new filings after a report in The New York Times criticized the hospital network because it “plowed ahead” with a “flood of litigation” in the middle of the COVID-19 pandemic.

Northwell Health had filed 2,500 lawsuits last year seeking to collect on unpaid medical debts, according to the report. While it was one of about 50 different hospitals across New York state that filed 5,000 lawsuits last year, Northwell was singled out because of the number of suits it filed related to the other hospitals and because its chief executive has close ties to New York Governor Andrew Cuomo.

Northwell is the latest in a growing line of hospital networks and healthcare providers who have been spotlighted for allegedly aggressive collection efforts by filing lawsuits to collect on unpaid debts. Hospitals in Colorado, Texas, Virginia, Oklahoma, New York, Tennessee, Kansas, Maryland, and Wisconsin of being “too aggressive” by filing lawsuits to collect on unpaid debts. Many hospitals — like Northwell — stopped filing collection lawsuits and enforcing judgments as a result of the publicity.

A spokeswoman for Northwell said that the hospital files lawsuits on less than 0.1% of claims and that taking legal action is a last resort when individuals do not respond to “multiple outreach attempts” and after “extensive” research indicates those individuals have a “strong ability” to repay the debt.

Northwell’s chief business strategy officer said in an interview with The Times that the hospital lost $300 million last year. Northwell had paused filing new lawsuits for six months last year after the pandemic struck the United States, but appeared to restart filing lawsuits in September, according to a published report.