As Patients Struggle With Bills, Hospital Sues Thousands

From The New York Times, I’m Michael Barbaro. This is “The Daily.”

Today: for decades hospitals could assume that patients with jobs and health insurance would pay their medical bills. Sarah Kliff on why that’s no longer the case and the aggressive new way that hospitals are forcing those patients to pay up.

It’s Monday, December 2.

Sarah, tell me about Amanda Sturgill.

So Amanda is 41 years old. She lives in this tiny little town in rural Virginia called Norton.

She has four children. She’s a single mom.

Sarah Kliff writes about health care for The Times.

She works full time at an audio equipment company, where she processes orders.

And a few years ago —

— Her daughter Michaela was giving one of the other kids a bath.

Mm-hm.

She bent down to pick up her sibling and just got this terrible pain in her back.

Amanda, obviously, is worried. She doesn’t understand what’s going on, so she takes her daughter to the emergency room at the local hospital system, a company named Ballad. They give her a pain shot, go back home, but this pain doesn’t go away.

They start seeing specialists and doctors. There are M.R.I.s. There are more pain shots. And no one can really figure out what’s going on with Michaela, and the pain is getting worse.

She can’t walk without pain. She’s having trouble sleeping, and Amanda’s like, oh my gosh, is my teenage daughter going to have to live with this terrible pain for the rest of her life?

Hm. So what happens?

They figure out that Michaela has a degenerative disk disease.

Hm.

So it’s serious, and a doctor recommends that the best course of action is surgery.

So the surgery happens. It goes decently well. It doesn’t fully relieve Michaela’s pain, so that issue still lingers. But they go home, and then the bills start showing up.

They trickle in, because remember, there have been all these doctor appointments, all these specialists, and M.R.I.s, and shots. So there’s a few that are like —

100 there.

But then the bills get bigger.

The surgery bill comes, and that’s over $2,000.

Wow.

For Amanda, she earns $12.70 per hour at her job. This is a really significant bill, and she just does not have the money to pay it.

And does Amanda have insurance?

She does. Yeah, she has insurance at work. She felt like it was good insurance, but then she’s finding that her insurance actually expects her to pay a lot of co-pays, a certain share of the surgery. And it’s starting to get pretty stressful.

She really wants to pay the bills.

She’s trying to scrape together the money.

So for a while, this works and she’s able to keep up with the bills. She’s sending in payments to the hospital. But a few months ago, she falls behind. She just isn’t able to come up with the payments that she’s supposed to be making on these bills. And then one day, there’s a knock at the door.

And the dogs start barking.

And he has a document that he needs to give Amanda.

So Amanda takes the documents.

She tells the kids, don’t worry, it’s just some important papers that they couldn’t deliver in the mail.

And then she actually opens it up, and it turns out that the hospital is suing her for the medical debt that she owes them. And this is a court warrant with a court date that they’re asking her to attend.

So she has fallen behind on this bill, and the hospital is now taking her to court over this unpaid bill.

Exactly, and things have moved from the billing department into the courtroom. Amanda has a court date.

But it turns out her court date is actually a day she has an appointment.

She had recently found a lump in her breast, and it had taken her weeks to schedule a mammogram.

Hm.

Sarah, nothing about this sounds normal. A mother with a solid job and health insurance suddenly has a sheriff at her door, and she faces legal action over falling behind on a medical bill.

It is actually becoming surprisingly common in our health care system. There are thousands of Americans many with private insurance currently being sued by their hospitals. They’re in big cities. They’re in small towns. And the reason I know this is actually the story of how I found Amanda.

We’ll be right back.

O.K., Sarah, you said that finding Amanda helped you understand how widespread this problem was. So how did you find Amanda?

I found Amanda a few months ago, when I went to this tiny little courtroom in rural Virginia, about six hours west of Washington, D.C., where I live. And on the day I went to court, there were 160 cases on the docket. 102 of those cases were being brought by the local hospital system, Ballad. In each of those cases, the hospital was suing one of its patients for outstanding medical debt.

Hmph.

And Amanda was one of the 102 cases that would be heard that day.

So what’s happening here? Why is a local hospital suing over one hundreds of its patients?

Yeah, so that’s something I started to figure out, talking to the people who were in the courtroom, and calling people who weren’t in the courtroom. It turns out most patients actually didn’t show up to their court date. And what I found out is, a lot of these people had health insurance. There was a school teacher, a correctional officer, even a woman who worked at the hospital, who had private insurance, but were responsible for shares of their bills that they just felt like they couldn’t pay. And now Ballad was turning to the courts to recoup the money that they were owed.

Why is that the case? Why are people with jobs and insurance falling behind on their payments and now being sued?

So in order to understand that, I think you need to zoom out from the courtroom and look at a big change that has been happening in our health care system over the past decade or so. What I see in my reporting is patients consistently being asked to spend more and more of their own money on health care, even when they have insurance. A really perfect example of this is deductibles. That’s the amount that a patient has to pay before their insurance will start kicking in and covering their doctor visits and their hospital trips. If you look back to, like, 2006 or so, only about half of people who had insurance even had a deductible. They weren’t that common. You flash forward to this year, and 82% of people who get insurance at work now have a deductible. The size of the average deductible has about tripled between 2006 and 2018. It used to be about $600. Now it’s about $1,700.

Hm.

So you have this moment when health care prices are going up, and up, and up, and patients are being asked to pay for it and pay more through deductibles, through co-payments.

And why is that? Why are so many of these plans now asking people to pay such a high deductible?

It mostly comes down to the fact that health care prices are growing really quickly. And if you’re an employer, if you’re an HR department, you have a few ways to deal with this. You could increase your employees’ premiums. That’s the amount they pay each month. Or you could keep premiums constant, and just ask people to pay more when they go to the doctor. A lot of companies have found that the latter option is the way they want to go.

Hm.

So that’s how employers deal with this problem of rising costs, but then you have someone like Amanda, who does have to go to the doctor a lot, for her daughter, and ends up with this bill she can’t afford. And you have the hospital on the other end of this, who is watching hundreds of Amandas in their system, all of a sudden not being able to pay the bills that the insurance company typically was taking care of.

Got it. And when a person can’t pay that bill, now the hospital is suddenly on the hook. So it’s cascading through the system.

Exactly. And hospital executives, when they see someone who comes in with insurance, they’re thinking, O.K., this is someone who can pay their bills. They have the backing of an insurance company. But that’s not really the case. You have this whole new bucket of patients that hospital executives aren’t really sure how to deal with. Some are dealing with it by coming up with financial assistance for those people. Others are dealing with it by going to court to try and collect the debt that insurance companies used to pay them.

So what do hospitals like Ballad say about why they’re making this decision to sue their patients?

They say that, look, we’re a business. We have to stay open. We have to stay afloat. Ballad exists in a pretty rural area, a part of Virginia and Tennessee, and we’ve seen a lot of rural hospitals closing.

Hm.

They would argue that the financially responsible thing to do is collect the debts that are owed to them. They say that they only pursue patients in court who can afford to pay but have chosen not to pay their medical bills.

Hm. So people who, in their minds, if they prioritized paying back these bills and organized their finances around that, they could pay those bills.

Exactly. These are people with jobs, people with insurance. From their perspective, these are people who could pay that debt, and Ballad is serious about collecting that debt.

And what does someone like Amanda say to that?

She does not think she fits that description.

Amanda feels like she’s skipping meals, and she’s selling her things to pay.

Then there’s kids to take care of.

You’ve said that this is becoming more common, but just how common is this kind of a lawsuit now?

So what’s happening at Ballad is pretty representative of a trend we’re seeing across the country. If you look at Ballad’s lawsuit volume, they’ve been suing patients for a while, but back in 2010, it was about 3,600 lawsuits a year in the court records I examined. Flash forward 2018, there’s over 6,700 lawsuits.

So double.

Doubled in less than a decade. You look at other hospitals, Children’s in Wisconsin is a good example. This is a nonprofit pediatric hospital. They’ve sued more than a thousand patients since the start of 2018. And that’s more lawsuits in two years than the entire decade prior. Johns Hopkins University in Baltimore and New York Presbyterian in Manhattan, they still have pretty low lawsuit volume, but it’s going up.

And is it ever the case that a company like Ballad sues a patient, the patient pays and it all resolves itself?

Definitely. So hospitals are finding that the courts are a pretty good way to collect money for a few reasons. The first is that patients typically don’t show up to their court date. That means, as long as the hospital sends a lawyer, they’re going to win the case because the other party didn’t show up. Once the hospital wins the case, they have the rights to start garnishing their patients’ wages. You can get a lien on their property. You can even arrest them. It gives the hospital a lot of power working through the court system.

So how does Amanda’s case end up playing out in court?

So she doesn’t go to the first court date.

There’s a second court date that she said she never heard about, where the hospital does get a judgment against her, but her wages have not been garnished. She ended up setting up a $150 a month payment plan.

So what happens once she starts falling behind in these payments?

So she’s nervous. She’s worried. There’s this court warrant out for me. Could they throw me in jail? And she sees that the hospital is calling her.

And the person on the other end of the phone says, we’re just calling to tell you —

Somebody paid you medical bill. You don’t have to make payments anymore.

Hah.

So what had happened here?

So what happened was, I ended up writing about Amanda’s story in The New York Times. And between that story running and that phone call, an anonymous donor read about the story, called Ballad and offered to pay off Amanda’s bills.

So she is now without debt from this back problem that her daughter had? She’s kind of scot-free?

Well, sort of.

Sarah, what do you make of what happened to Amanda?

I think it shows you something really problematic about the current state of American health insurance. When you think of even the concept of insurance, it’s supposed to mean protection. It’s supposed to mean you have someone else who’s going to pay your medical bills, no matter how high they get.

Hm.

We spend a lot of time talking about the people who don’t have health insurance, about 30 million or so Americans at this point, but you also have this class of people who you could think of as underinsured, who are paying premiums, who are buying some kind of product that they think of as insurance, but then when they actually have to use a lot of health care, they’re finding that it’s not really protecting them in the way that they expected to be protected.

O.K., Sarah, right now we’re in the middle of a national debate about those very questions, the future of American health care. And the concept that is most widely debated in the context of the presidential election is Medicare For All, is the United States government taking on health care and eliminating the kind of private insurance that someone like Amanda has. If such a system were created, how would it address the issues that you have discovered in your reporting?

The system being proposed now in the presidential primary would get rid of deductibles. There’d be no premiums. There’d be no copayments. When you went to the doctor, you would not pay a single penny. But the money has to come from somewhere, right? You need a lot of those anonymous donors who paid off Amanda’s bill to be financing such a system. So you’d need to have a big shift in who’s paying for health care.

Hm.

There is going to be a lot of debate around Medicare For All and single payer in the next year. There are a lot of pluses and minuses to that type of system. But what I can certainly say is that if the United States adopted a system like that, I would not have stories like Amanda’s to write anymore.

Sarah, thank you very much.

Thanks, Michael.

We’ll be right back.

Here’s what else you need to know today.

During an unannounced trip to Afghanistan, President Trump said that the U.S. would reopen peace talks with the Taliban, aimed at ending the 18-year-old war there. Trump had abruptly ended the talks in September, after the Taliban claimed responsibility for a suicide bombing that killed a U.S. soldier.

But the president has now injected confusion into the negotiations by demanding a cease fire from the Taliban, something U.S. diplomats had never before sought, are unlikely to obtain, and have little power to enforce. And in a letter, the House Judiciary Committee has given President Trump a deadline of this Friday to decide whether to present a defense or call a witness as the committee considers articles of impeachment against him. The letter lays out a rapid timetable for impeachment in the House. The Judiciary Committee could vote on articles of impeachment by the week of December 9th, and the full House could vote on impeachment by the week of December 16.

That’s it for “The Daily.” I’m Michael Barbaro. See you tomorrow.