A healthcare practice in New York that performs bariatric surgery is in the spotlight this week for filing a bunch of lawsuits against patients who did not pay their bills, and the chief executive of the practice is putting the blame on the patients in a published report for not forwarding the checks they receive from their insurance providers to the facility.
The facility has filed “hundred” of debt collection lawsuits in the past four years, according to a published report. Backed by a major private equity firm, the facility has used out-of-network payment agreements in at least 300 lawsuits from January 2019 through 2022, demanding nearly $19 million to cover medical bills, interest charges, and attorney’s fees. In 60 of those cases, the suits demanded at least $100,000. In many cases, the patients sign an “out-of-network payment agreement” which requires them to forward any money received from their insurance company to the healthcare facility. But some individuals don’t do that, and keep the checks for themselves, the facility’s chief executive noted.
“These lawsuits stem from these patients stealing the insurance money rather than forwarding it onto NYBG as they are morally and contractually obligated to do,” Dr. Shawn Garber wrote in an email to KFF Health News.
Garber added: “The issue is not with what we bill, but rather with the fact that the insurance companies refuse to send payment directly to us.”
Garber also noted that patients are made fully aware of their financial responsibilities before any procedures are performed.
The facility has even filed adversary complaints when patients file for bankruptcy protection, seeking to force the patient to repay the debt even after filing for bankruptcy. The practice has won default judgments totaling nearly $6 million in about 90 of the 300 cases reviewed.