UVA Lawsuits Archives - Ä¢¹½Ó°Ôº Health News /news/tag/uva-lawsuits/ Tue, 20 Apr 2021 20:21:31 +0000 en-US hourly 1 https://wordpress.org/?v=6.5.4 /wp-content/uploads/sites/2/2023/04/kffhealthnews-icon.png?w=32 UVA Lawsuits Archives - Ä¢¹½Ó°Ôº Health News /news/tag/uva-lawsuits/ 32 32 161476233 UVA Health Will Wipe Out Tens of Thousands of Lawsuits Against Patients /news/article/uva-health-will-wipe-out-tens-of-thousands-of-lawsuits-against-patients/ Tue, 20 Apr 2021 09:00:00 +0000 https://khn.org/?post_type=article&p=1294242 University of Virginia Health System, which for years has sued thousands of patients annually for unpaid bills, said Monday it will cancel a massive backlog of court judgments and liens resulting from those lawsuits dating to the 1990s.

Combined with reforms UVA announced in 2019, the move is likely to benefit tens of thousands of families and make UVA Health’s collections policies much more generous than those of many hospital systems, said scholars who study health care finance. The decision to wipe out liens that can drain home equity years after a hospital visit is extremely rare, they said.

UVA had been suing patients for decades, many with unpaid bills in the tens or hundreds of thousands of dollars, KHN reported in 2019. Once the health system won cases in court, it could seize wages and the value of patient homes when they were sold. UVA limited its collections lawsuits after KHN’s investigation.

“This is very significant and a much-needed and overdue step,” said Erin Fuse Brown, a law professor at Georgia State University who studies hospital billing. “I don’t know if I’ve heard of that [lien abolition] happening anywhere else.”

But most families who have already surrendered money to UVA as a result of lawsuits or liens will not get their money back.

UVA will release all liens and judgments filed against all households making less than 400% of federal poverty guidelines, or $106,000 for a family of four, which should account for most of them, said Douglas Lischke, the system’s chief financial officer.

“This is a proud moment for us,” he said in an interview. “We want our financial care to be as good as our clinical care.”

“I am proud to see UVA Health System taking real steps to scale back aggressive medical collections and address the pain they’ve caused,” said Virginia Gov. Ralph Northam, a pediatric neurologist. 

Doris Hutchinson was surprised two years ago to find a UVA lien related to a relative’s bill on her mother’s Charlottesville, Virginia, home. The medical system demanded $39,000 from the family before the house could be sold. The money was placed in escrow.

Three weeks ago, she learned the judgment would be canceled and the money released.

“I’ll be excited about that,” said Hutchinson, who said she needs the funds to help pay for her grandchildren’s college education and replace income from her husband, who died two years ago. “I’m also happy for everybody else” who gets UVA bill relief, she said.

UVA will also stop blocking enrollment for university students with outstanding balances at the health system, university spokesperson Brian Coy said Monday. Keeping students from completing their education because they owed hospital bills was another practice revealed by KHN.

KHN reported in 2019 that UVA Health had sued patients 36,000 times over six years for more than $100 million, often for amounts far higher than what an insurer would have paid for their care. In response to the articles, the system suspended lawsuits against patients and wage garnishments, increased discounts for the uninsured and broadened financial assistance, including for cases dating to 2017.

The system named an advisory council of UVA officials and community leaders to consider permanent changes. The council delivered recommendations in October.

Like most hospitals, UVA wasn’t using property liens to foreclose on patients’ homes. But it was seizing money owed — plus 6% interest — from home equity when home sales went to settlement.

In response to KHN’s investigation, UVA said in 2019 it would improve financial assistance but continue to use the courts to recover money owed from families making more than 400% of the poverty threshold.

While unusual, UVA’s decision to substantially reduce lawsuits and erase liens stops short of moves recently made by VCU Health, its sister system based at another state university. VCU pledged to stop suing all patients and, in a process taking more than a year in courthouses across Virginia, is abolishing all old judgments and liens regardless of a family’s income.

“This seems like many steps in the right direction” for UVA, said Jenifer Bosco, an attorney at the National Consumer Law Center who specializes in health care. “There is always more that could be done. But providing assistance to families with income of up to 400% of the poverty level is a great step.”

The number of outstanding UVA Health judgments is unknown. For its part, VCU eventually found about 80,000 statewide. In Virginia, liens expire after 20 years, but UVA was taking the trouble to renew claims dating to the 1990s, KHN found.

Canceling them should take more than a year, Lischke said. UVA’s changes to billing and collections, including improvements to financial assistance announced in late 2019, will cost the system about $12 million a year, he said.

UVA’s move is far more beneficial to its patients and its region than other so-called community benefits that many nonprofit hospitals offer to justify their tax-exempt status, said Ge Bai, associate professor at Johns Hopkins Bloomberg School of Public Health.

Instead of testing services or medical education that are often hospital marketing campaigns in disguise, “this action is a concrete effort to relieve the financial burden of the community,” she said. “It also improves mental health. It relieves the stress.”

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UVA Health Still Squeezing Money From Patients — By Seizing Their Home Equity /news/uva-health-property-liens-patient-medical-debt/ Mon, 19 Oct 2020 09:00:35 +0000 https://khn.org/?p=1195661 Doris Hutchinson wanted to use money from the sale of her late mother’s house to help her grandchildren go to college.

Then she learned the University of Virginia Health System was taking $38,000 of the proceeds because a 13-year-old medical bill owed by her deceased brother had somehow turned into a lien on the property.

“It was a mess,” she said. “There are bills I could pay with that money. I could pay off my car, for one thing.”

Property liens are the hidden icebergs of patient medical debt, legal experts say, lying unseen, often for decades, before they surface to claim hard-won family savings or inheritance proceeds.

An ongoing examination by KHN into hospital billing and collections in Virginia shows just how widespread and destructive they can be. KHN reported a year ago that UVA Health had sued patients 36,000 times over six years for more than $100 million, often for amounts far higher than what an insurer would have paid for their care. In response to the articles, the system temporarily suspended patient lawsuits and wage garnishments, increased discounts for the uninsured and broadened financial assistance, including for cases dating to 2017.

Those changes were “a first step” in reforming billing and collection practices, university officials said at the time.

However, UVA Health continues to rely on thousands of property liens to collect old bills, in contrast to VCU Health, another huge, state-owned medical system examined by KHN. VCU Health pledged in March to stop seizing patients’ wages over unpaid bills and to remove all property liens, which are created after a creditor wins a court judgment.

Working courthouse-by-courthouse, VCU Health now says it has discovered and released 45,000 property liens filed against patients just in Richmond, its home city, some dating to the 1990s. There are an estimated 35,000 more in other parts of the state. Fifteen thousand of those have been canceled and they are working on the rest, officials said. These figures have not been previously reported. The system is part of Virginia Commonwealth University.

VCU Health’s total caseload is “a huge number” but perhaps not astonishing given the energy with which many hospital systems sue their patients, said Carolyn Carter, deputy director of the National Consumer Law Center.

Despite having suspended patient lawsuits, UVA Health has continued to create property liens based on older court cases, court records show. The number of new liens is “small,” said UVA Health spokesperson Eric Swensen.

An advisory council of UVA Health officials and community leaders is expected to deliver new recommendations by the end of October, Swensen said. The council, whose schedule has been slowed by the coronavirus crisis, has discussed property liens, Don Gathers, an activist and council member, said in an interview this summer.

Nobody knows how many old or new UVA Health liens are scattered through scores of Virginia courthouses. The health system, which has sued patients in almost every county and city in the state, has failed to respond to repeated requests over two years to disclose the number and value of its property liens.

But in Albemarle County alone, which surrounds the university’s Charlottesville home, “there are thousands” of UVA Health judgments filed in the land records, which creates a lien, said Circuit Court Clerk Jon Zug.

Not just Virginia homes are at risk. UVA Health lawyers search the nation for property or other assets owned by patients with outstanding bills and have filed liens in Maryland, West Virginia, Ohio and Florida, court records show.

The system put a lien on a Nevada vacation condo owned by Veronica Musie’s family a decade ago over a $30,600 hospital bill, said Musie, who lives in northern Virginia. The family has since paid the debt.

Virginia property liens expire after 20 years. But UVA Health often renews them. Since 2017, just in Albemarle County, it has renewed more than three dozen liens. That means the medical system could seize families’ home equity until 2039 for bills dating to the last century.

UVA Health and other medical systems rarely force the sale of a home to claim money. Instead, they wait for families to refinance or sell, taking their cut at the settlement table. But with 6% simple interest accumulating year after year after the court judgment, as allowed by Virginia law, the final amount owed can be much more than the original charges.

UVA Health treated Hutchinson’s brother for heart disease in the early 2000s. The unpaid bill was $24,868. The system laid claim to their mother’s home because he was one of her heirs. The claim is up to $38,000 now, she said, because of interest charges. Hutchinson has been disputing it for more than a year.

VCU Health and its MCV Physicians affiliate estimate that eliminating two decades of property liens in courthouses across the state, which they began to do last year after KHN published its reports, won’t be finished until spring.

Richmond was especially problematic. Because releasing 40,000 Richmond liens by hand would have been impractical, VCU Health got a judge’s permission to do it with computer code.

Creditors such as UVA and VCU don’t need addresses to create liens. All they have to do is file a judgment in county or city land records. If debtors own any property there, title companies won’t approve a sale until the debt is paid, often with home equity.

Often owners don’t know debts exist until paralegals unearth them when homes are sold, property pros say. Old debts can create liens on newly acquired real estate.

“It could be your grandmother’s house, and as soon as you’ve inherited it, and you’ve got judgments, those [liens] are now attached,” said Richmond Court Clerk Edward Jewett.

Frequently debtors own no property, so judgments in the land records expire without hospitals or other creditors getting anything.

VCU and MCV had no idea how many liens they had placed across the state until they began investigating last year after KHN’s inquiries, officials said.

“It’s an incredibly manual process” to cancel the claims, partly because computer systems at many courthouses prohibit an easy tech solution, said Melinda Hancock, VCU Health’s chief administrative and financial officer. But it’s worth it to remove a burden on patients, she said, adding, “This is an outdated collections practice whose time has come and gone.”

But many medical systems still do it, consumer debt experts say, noting that obtaining a complete picture of hospital property liens is impossible.

Land and judgment records are held by thousands of local court clerks, often using separate computer systems. Records are difficult or impossible to obtain in bulk.

“There is not a good nationwide study that I know of that looks at how widespread this is, how many consumers are affected, what’s the average size of a lien,” said Erin Fuse Brown, a law professor at Georgia State University who studies hospital billing.

Mike Miller and Kitt Klein are among those hoping UVA Health follows VCU Health in canceling thousands of property liens. They fear a $129,000 judgment won by UVA in 2017 against Miller will cost them the equity in their home in Quicksburg, Virginia.

They make about $25,000 a year. Miller, a house painter, was insured but received out-of-network radiation at UVA that doctors said was necessary to treat his lung cancer.

After KHN wrote about his case a year ago, benefits firm WellRithms analyzed his UVA bill and found that a commercial insurer would have paid a little more than $13,000, not $129,000, for the treatment.

“We know all [health care] providers bill a lot, but usually ‘a lot’ is three to six times what reasonable prices would be,” said Jordan Weintraub, vice president of claims for WellRithms. Trying to collect 10 times as much, she said, “is really out there.”

UVA Health does not comment on individual patient cases, Swensen said.

KHN found last year that UVA frequently sued patients for far more than what the system could have collected from insurance.

Early this year Miller and Klein emailed UVA President James Ryan, asking for help in reducing or eliminating the judgment. His office phoned in February, saying it would review the case.

“I became very emotional, filled with gratitude,” Klein said. “I couldn’t talk.”

Months went by with no contact. Recently a lawyer from the office of Virginia Attorney General Mark Herring offered to settle the case for $120,000, Klein said, reducing the bill by only $9,000. They don’t have the money. Miller’s cancer has returned. Interest is mounting at 6%.

University officials do not comment on legal matters or individual cases, a Ryan spokesperson said. Herring’s office did not respond to requests for comment.

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VCU Health Halts 30-Year Campaign That Seized Patients’ Wages, Put Liens On Homes /news/medical-debt-vcu-health-halts-30-year-campaign-that-seized-patients-wages-put-liens-on-homes/ Wed, 11 Mar 2020 09:00:21 +0000 https://khn.org/?p=1061733 In one of the most sweeping moves yet by a nonprofit hospital system to reduce aggressive bill collection, VCU Health is halting seizure of patients’ wages and removing thousands of liens against patients’ homes, some dating to the 1990s.

“Health care needs to be more affordable for patients, and we want to be part of the solution,” said Melinda Hancock, VCU Health’s chief administrative and financial officer. “We believe that no hospital bill should change the economic status of a family.”

The moves follow an investigation last year by Kaiser Health News that found VCU Health and Virginia’s other major teaching-hospital system, UVA Health, pursued tens of thousands of patients over the years for overdue bills, sending many into bankruptcy.

The practices included filing courthouse liens against the value of patients’ homes and garnishing wages, many from workers at lower-pay employers, such as retailers and restaurants.

Canceling liens ends the threat that VCU Health, part of Virginia Commonwealth University in Richmond, will take big chunks of equity when family homes are sold. Liens can easily reach thousands of dollars per property. Virginia allows creditors to garnish up to 25% of someone’s earnings.

“That is great news for VCU patients,” said Jenifer Bosco, an attorney with the National Consumer Law Center who specializes in medical debt. “I don’t recall hearing about other hospitals taking that step and canceling decades of past liens.”

Because they accrued interest of 6% annually or more, old liens could let VCU and UVA seize amounts far higher than the original hospital and doctor bills.

Undoing decades of property claims will require VCU lawyers to visit every circuit courthouse across the state, “which could take up to a year to complete,” said system spokesperson Laura Rossacher.

VCU’s moves are “an instant way to create a lot of goodwill and relieve patients of an incredible financial and emotional burden,” said Erin Fuse Brown, a law professor at Georgia State University who studies hospital billing. “UVA should do the same.”

VCU and UVA are the two major teaching hospital systems in Virginia, taking in billions annually and recording tens of millions of dollars in profits. UVA Health is part of the University of Virginia, based in Charlottesville.

Virginia Gov. Ralph Northam, a pediatric neurologist, “is proud to see VCU Health System taking significant, in some cases historic, steps to scale back aggressive medical collections and address the pain it’s caused,” said his spokeswoman, Alena Yarmosky.

Both VCU and UVA, which are state-run, have increased financial assistance and discounts for uninsured patients since KHN published its reports.

VCU pledged earlier to end all routine lawsuits for overdue bills, which are the precursor to garnishments and liens. The latest move cancels such claims resulting from old suits and judgments.

VCU’s in-house doctor group, MCV Physicians, filed more than 56,000 lawsuits against patients for $81 million over seven years, KHN found. VCU’s flagship hospital, VCU Medical Center, stopped filing patient suits seven years ago.

The litigation also included more than 15,000 garnishment cases over that period, some for VCU Medical Center but mostly for the physician group, the data showed.

VCU will not refund money collected in the past.

“They have socked it to a lot of people,” said Joseph Robinson, a Richmond church music director garnished last year for $851 by MCV Physicians for treatment he said happened years ago. “They were just going after anybody they could get.”

VCU joins Yale New Haven Health among the few hospital systems that have forsworn routine patient lawsuits. Such systems still bill for overdue accounts and try to collect money, but they stop short of seeking the legal right to seize assets.

For its part, UVA has said it will substantially reduce patient lawsuits, seeking court judgments for overdue bills only from families making more than 400% of federal poverty guidelines. That’s income of $86,880 for a family of three.

But its current policy of maintaining old liens and continuing to sue at least some patients makes it more aggressive than VCU.

On the other hand, UVA has made its new, wider financial assistance policy retroactive to July 2017 and in recent months has forgiven $15 million in debt for treatment after that date, said UVA spokesman Eric Swensen.

The system has also stopped wage garnishments “at this time,” he said. UVA has said changes announced so far are a “first step.” A community advisory council meeting monthly since last year will “inform and guide us as we explore changes to our policies,” Swensen said. Recommendations are expected this summer, he added.

UVA Health and affiliates filed 36,000 lawsuits against patients over six years, seeking a total of more than $106 million, KHN found.

Neither UVA nor VCU has responded to repeated queries about exactly how many liens they hold or how much they collect in lien proceeds, garnished wages and bank accounts.

“Compared to the harm it causes for patients, I can’t imagine that the hospitals are getting a significant amount of revenue from these legal actions,” said Fuse Brown.

Hospitals say they see more and more patients who can’t pay, even with insurance, because of stagnating incomes and rising insurance deductibles.

in Virginia’s General Assembly is expected to increase funding for VCU’s and UVA’s indigent care programs as well as update the family-asset test for patients seeking financial assistance, which hasn’t changed since 1985.

As reported last year by KHN, even $3,000 or $4,000 in a 401(k) or other retirement account could bar a patient from financial help. The legislation increases the asset-test threshold to $50,000, not counting a car and a house on less than 4 acres.

Another bill would prohibit the systems from suing or sending bills to collections before they determine whether patients qualify for Medicaid or financial assistance.

“We’re on the right path now,” said Jill Hanken, a health care attorney for the Virginia Poverty Law Center, which was behind the bill. “It was very important to put the brakes on these aggressive collection activities and force these hospitals to look more closely at their indigent care policies.”

Health care finance experts continue to criticize both VCU and UVA for what they charge the uninsured before factoring in any financial assistance.

Last year, UVA increased its discount for the uninsured from 20% off list prices to 40%. VCU increased the discount from 25% to 45%. But at those levels patients still pay far more than the health systems’ costs and far more than what the systems collect from the Medicare program for seniors.

“Until they reduce the amount they are trying to recover by adjusting their charge to what Medicare would have paid, people who owe debts will still face unreasonable demands,” said Sara Rosenbaum, a health law professor at George Washington University.

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Hospital Group Mum As Members Pursue Patients With Lawsuits And Debt Collectors /news/hospital-group-mum-as-members-pursue-patients-with-lawsuits-and-debt-collectors/ Sat, 28 Dec 2019 15:00:12 +0000 https://khn.org/?p=1033918 The American Hospital Association, the biggest hospital trade group, says it promotes “best practices” among medical systems to treat patients more effectively and improve community health.

But the powerful association has stayed largely silent about hospitals suing thousands of patients for overdue bills, seizing homes or wages and even forcing families into bankruptcy.

Atlantic Health System, whose CEO is the AHA’s chairman, Brian Gragnolati, has sued patients for unpaid bills thousands of times this year, court records show, including a family struggling to pay bills for three children with cystic fibrosis.

AHA, which represents nearly 5,000, mostly nonprofit hospitals and medical systems, has issued few guidelines on such aggressive practices or the limited financial assistance policies that often trigger them.

In a year when multiple health systems have come under fire for suing patients, from giants UVA Health System and VCU Health to community , it has made no concrete move to develop an industry standard.

“There could be a broader message coming out of hospital leadership” about harsh collections, said Erin Fuse Brown, a law professor at Georgia State University who studies hospital billing. “It seems unconscionable if they are claiming to serve the community and then saddling patients with these financial obligations that are ruinous.”

Nonprofit hospitals are required to provide “community benefit,” including charity care in return for billions of dollars in government subsidies they get through tax exemptions. But the rules are lax and vague, experts say, especially for bill forgiveness and collections.

The Affordable Care Act requires nonprofit hospitals to have a financial assistance policy for needy patients but offers no guidance about its terms.

“There is no requirement” for minimum hospital charity under federal law, said Ge Bai a health policy professor at Johns Hopkins. “You design your own policy. And you can make it extremely hard to qualify.”

Practices vary sharply, a review of hospital policies and data from IRS filings show. Some hospitals write off the entire bill for a patient from a family of four making up to $77,000 a year. Others give free care only if that family makes less than $26,000.

The law does not substantially limit harsh collections, either. only that nonprofit hospitals make “reasonable efforts” to determine if patients qualify for financial assistance before suing them, garnishing their wages and putting liens on their homes.

Gaping differences in both collections and financial assistance show up in the policies of health systems represented on AHA’s board of trustees.

This year, AHA board chairman Gragnolati’s Atlantic Health System, in northern New Jersey, sued patients for unpaid bills more than 8,000 times, court records show.

Atlantic Health sued Robert and Tricia Mechan of Maywood, N.J., to recover $7,982 in unpaid bills for treatment of their son Jonathan at the system’s Morristown Medical Center.

Three of the Mechans’ four children have cystic fibrosis, a chronic lung disease, including Jonathan, 18. Tricia Mechan works two jobs — full time as a manager at Gary’s Wine & Marketplace and part time at Lowe’s — to try to pay doctor and hospital bills that pile up even with insurance.

“I have bill collectors call me all the time,” Tricia Mechan said. “You’re asking me for more, and all I’m doing is trying to get the best care for my children. I didn’t ask to have sick children.”

She closed a savings account and borrowed money to settle Jonathan’s bill for $6,000. Another son with cystic fibrosis, Matthew, owes Atlantic Health $4,200 and is paying it off at $25 a month, she said.

Marna Borgstrom, CEO of Yale New Haven Health, also sits on AHA’s board. Yale almost never sues families like the Mechans.

“I have not signed off on a legal action since 2015” against a patient, Patrick McCabe, the system’s senior vice president of finance, said in an interview. “People are coming to us when they are at their most vulnerable, and we truly believe we need to work with them and not create any additional stress that can be avoided.”

Yale has treated Nicholas Ruschmeyer, 30, a Vermont ski mountain manager, for recurring cancer. He has been careful to maintain insurance, but a few years ago the hospital performed a $12,000 genetic test that wasn’t covered.

“Yale completely absorbed the cost,” said his mother, Sherrie Ruschmeyer. Yale is “wonderful to work with, not at all aggressive,” she said.

Atlantic Health bars families from receiving financial assistance if they have more than $15,000 in savings or other assets. Yale never asks about savings. Even families who own homes without a mortgage qualify if their income is low enough.

Atlantic Health’s policies including seizing patient wages and bank accounts through court orders to recoup overdue bills. Yale says it does not do this.

In some ways, Atlantic Health’s policies are more generous than those of other systems.

It forgives bills exceeding 30% of a family’s income in many cases, the kind of “catastrophic” assistance some hospitals lack. It also bills many uninsured patients only slightly more than Medicare rates. That’s far less than rates charged by other hospitals in the same situation that are substantially higher than the cost of treatment.

“Atlantic Health System’s billing policy complies with all state and federal guidelines,” said spokesman Luke Margolis. “While we are willing to assist patients no matter their financial situation, those who can pay should do so.”

After a reporter inquired about its practices, Atlantic Health said it “is actively engaged in refining our policies to reflect our patients’ realities.”

AHA also is considering changing its position on billing in the wake of recent reports on aggressive and ruinous hospital practices.

Previously AHA said billing offices should ,” without giving specifics, and treat them with “dignity and respect.” Queried this month, association CEO Rick Pollack said, “We are reevaluating the guidelines [for collections and financial assistance] to ensure they best serve the needs of patients.”

Kaiser Health News found that the University of Virginia Health System sued patients 36,000 times over six years, taking tax refunds, wages and property and billing the uninsured at rates far higher than the cost of care. Richmond-based VCU Health’s physicians group sued patients 56,000 times over seven years, KHN also found.

In Memphis, Methodist Le Bonheur Healthcare over five years, ProPublica reported. In South Carolina, hospitals have been from patients and their families, an examination by The Post and Courier showed.

In response, VCU pledged to stop suing all patients. UVA promised to , increase financial assistance and consider further steps. Methodist erased debt for 6,500 patients and said it would overhaul its collections rules.

Yale’s less aggressive policies also came in response to journalism — a on how the system hounded one family. Yale still sends overdue bills to collections, McCabe said. But it balks at the last, drastic step of asking a court to approve seizing income and assets.

For patients with unpaid bills, he said, “if you’re willing to play a game of chicken, you will win.”

Hospitals say they see more and more patients who can’t pay, even with insurance, as medical costs rise, family incomes plateau and out-of-pocket health expenses increase. In particular, they blame widespread high-deductible coverage, which requires patients to pay thousands before the insurance takes over.

“More consumers pay far more with fewer benefits,” Pollack said.

Some states go beyond federal rules for charity care and collections. In California, patients with an income of less than $90,000 for a family of four must be eligible for free or discounted care. New Jersey requires Atlantic Health and other systems to give free care to patients from families of four with income less than $51,000.

The National Consumer Law Center, a nonprofit advocacy group, that standard for large medical facilities. Its also would require substantial discounts for families of four with income below $103,000 and relief for patients with even higher incomes facing catastrophic bills.

The AHA should consider similar changes in its own guidelines, NCLC attorney Jenifer Bosco said.

“I would be interested in seeing them taking a more active role in creating some standard for hospitals about what’s too much,” she said. “What’s going too far? Given that this is a helping profession, what would be some appropriate industry standards?”

KHN senior correspondent Jordan Rau contributed to this report.

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UVA Doctors Decry Aggressive Billing Practices By Their Own Hospital /news/uva-doctors-decry-aggressive-billing-practices-by-their-own-hospital/ Sat, 23 Nov 2019 20:00:21 +0000 https://khn.org/?p=1024129 Prominent doctors at UVA Health System are expressing public outrage at their employer’s practices to collect unpaid medical debt from its patients.

A Kaiser Health News report in September that showed UVA sued 36,000 patients over six years for more than $100 million, seizing wages and savings and even pushing families into bankruptcy.

Like many physicians who work at U.S. medical centers, the UVA doctors said they had little idea how aggressively the hospital where they practice was billing and pursuing their patients for payment.

Although the health system has announced some interim measures to scale back collections practices, some of the system’s most senior physicians are now calling for UVA to stop suing its patients altogether. And they are urging the pursuit of an “immediate solution” to address the national epidemic of health care debt.

“We were appalled by the revelations of the aggressive, pitiless billing and collections practices” at UVA, Dr. Scott Heysell and two other senior staff members wrote in a letter to KHN published Saturday. “We felt betrayed,” they wrote, “and we had, by extension, betrayed those who had relied on us.”

Heysell, an infectious-disease specialist and associate professor at UVA School of Medicine, and his co-authors echoed other UVA researchers and clinicians contacted by a reporter who said they were surprised and dismayed by the health system’s practices.

UVA initially defended its practices, pointing to the , which requires state agencies to “aggressively collect” money owed. But within days of the KHN report, UVA said it would reduce its use of the courts and make it easier for patients to qualify for financial assistance.

That’s not enough, said the letter’s authors, who include Dr. Rebecca Dillingham, director of UVA’s Center for Global Health, and Dr. Michael Williams, director of the UVA Center for Health Policy.

They ask “why UVA cannot join other public hospitals that have effectively stopped suing patients altogether?”

Other University of Virginia faculty said the system’s practices undermined their efforts to improve care for middle- and lower-income families and was not in keeping with an ethos of putting patients first.

KHN’s findings “made me feel utterly hypocritical about my work and efforts to promote health equity,” Rajesh Balkrishnan, a UVA public health professor who researches cancer treatment in Appalachia, said in an interview.

“This is a public university with one of the richest endowments in the country,” he said. “At least take care of the immediate community you serve.”

In September, UVA Health suing patients only if their household income is more than 400% of the federal poverty level, or $103,000 for a family of four. It also pledged to increase discounts for the uninsured and upgrade its financial assistance for patients.

Those measures are “a first step,” it said. On Oct. 28, it of community leaders, patient advocates and UVA students and staff to consider further changes.

“We are continuing to thoughtfully review our billing and collection practices to find additional ways to better serve our patient as well as improve fairness and transparency,” said UVA Health spokesman Eric Swensen. “We are looking at all options to achieve these goals.”

Virginia Gov. Ralph Northam, who oversees the state’s university system and public hospitals, is a pediatric neurologist.

“As a doctor himself, Gov. Northam agrees with the doctors who have taken a stand against unfair and aggressive medical billing practices,” his spokeswoman said. “Much more can and should be done to address this issue.”

KHN’s report prompted discussions across the campus in Charlottesville about how to treat uninsured patients or those with coverage who still struggle with thousands of dollars in out-of-pocket expenses, doctors and faculty said.

“No physician wants to be responsible for bankrupting a patient — not one physician, not one patient,” said Dr. Mohan Nadkarni, UVA’s chief of general internal medicine. He is the only physician on the advisory council.

“UVA physicians were completely taken aback by the scale and magnitude of the collections practices,” Nadkarni said. Discussion at the council’s first meeting reflected “lots of pent-up dissatisfaction from community leaders” about UVA’s practices, he said.

But many knew the health system was suing patients, they said. Some had firsthand experience with aggressive tactics from the billing office.

At one “town meeting” of health system employees, held at UVA’s Leonard Sandridge Auditorium in response to KHN’s report, somebody took the mic and asked, “Who in this room has been taken to collections by UVA?” said Matthew Gillikin, a speech therapist who was there. A quarter to a third of the people raised their hands, he said.

Court data analyzed by KHN showed that UVA Health was suing about 100 of its employees every year.

Also at the town meetings, “we heard many agonizing stories of patients and employees having been sued or having wages garnished,” Nadkarni said. “We heard loud and clear from many physicians that they heavily supported significant liberalization” of UVA Health’s financial assistance policies.

Family physician Dr. Alex Salomon, who worked at UVA for seven years and now is with Augusta Health in Fishersville, Va., had “a lot of patients” with UVA bill and lawsuit problems, many who had insurance but could not make out-of-pocket payments, he said. Still, he added, “I didn’t realize UVA was so much worse” than other hospitals.

As part of the University of Virginia, UVA Health is a state institution that is not subject to taxation. UVA Medical Center, the system’s flagship hospital, on revenue of $1.8 billion in the fiscal year ending in June and held stocks, bonds and other investments worth about $1 billion.

Doctors are realizing that financial barriers to treatment and budget squeezes from bills can be as harmful to patients as disease, said Dr. Marty Makary, a surgeon and researcher at Johns Hopkins Medicine who studies hospital debt collection and is urging UVA alumni to press for further change.

“I have not talked to a single patient or student of UVA or faculty member or alumni who thinks it is reasonable for the hospital to sue patients who cannot afford their bill,” he said.

News of UVA collections practices served as a teaching moment for at least one class.

“Many of the students in my class work for the UVA Health System, so the recent media coverage about UVA’s billing practices has been painful for them as nurses who care deeply about the patients and families they serve,” Kimberly Acquaviva, a professor who teaches health policy at UVA’s nursing school, tweeted in September. “As a class, we talked about the power that nurses have to shape the lives of the patients and families” by advocating for system change, she said.

She declined a request for an interview, as did five other doctors or professors. Several referred a reporter to UVA spokesman Swensen. About 20 others did not respond to interview requests.

Dr. Chris Ghaemmaghami, an emergency and internal medicine doctor, became UVA Health’s acting CEO after Pamela Sutton-Wallace announced her resignation in September. Her departure was unrelated to KHN’s revelations, UVA said at the time.

“I understand the disappointment some fellow physicians felt when our historic billing and collection practices came to light,” he said in an email responding to questions from KHN.

Heysell, Williams and Dillingham, the doctors who wrote the letter, go further.

“To be clear, we are outraged,” they write. “We stand with those that have been financially injured, whose bank accounts have been looted, whose homes have been swallowed as if they were built on quicksand, whose credit scores were ruined, and whose mental health and energy were spent in a courtroom or in anxious conversations with lawyers — all as a result of having sought our care.”

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As UVA Scales Back Lawsuits, Pain For Past Patients Persists /news/as-uva-scales-back-lawsuits-pain-for-past-patients-persists/ Mon, 04 Nov 2019 17:04:53 +0000 https://khn.org/?p=1015161 Kitt Klein and Mike Miller lost thousands of dollars in hard-won savings more than a decade ago after UVA Health put a lien on their home for a hospital bill they couldn’t pay.

They can’t believe they’re at risk of losing a second home today.

“Can they do this twice?” said Klein, who lives with her husband, a house painter, in her late mother’s house in Virginia’s Shenandoah Valley.

The couple was hit with a $129,133 court judgment in 2017 after UVA sued them and won in a case involving unpaid bills for out-of-network treatment of Miller’s lung cancer the year before, court documents show.

Last month, UVA said it would scale back such activity after a Kaiser Health News investigation found the medical system had filed 36,000 patient lawsuits for more than $100 million over six years, sending many families into hardship and bankruptcy. Its pursuit of former patients included putting thousands of liens on homes.

The prestigious medical system, affiliated with the University of Virginia in Charlottesville, said it is suspending current lawsuits, expanding financial assistance and even reconsidering old cases and applying aid retroactively. The new policies apply to people treated in July 2017 or later, according to Doug Lischke, UVA Health’s chief financial officer.

But that means people such as Miller, who received hundreds of thousands of dollars in financial assistance from his local hospital but not from UVA, won’t benefit from the changes. Thousands of former patients owing old bills, many with court judgments against them and wages being garnished or liens on their homes, will continue to suffer under the previous rules.

“There’s so many people that I’m talking to that are so relieved, saying thank God people are finally getting some justice,” said former patient Denise Nunez, 45.

But she’s still paying off a UVA bill of about $1,500 dating to 2014, legal papers show. It never came to her house because a clerk transposed the address number, she said. The new policies don’t stand to benefit her, either.

At the same time, patients treated more recently said they are struggling to obtain information on the changed rules and uncertain whether they’ll be helped. Unlike VCU Health in Richmond, which halted all routine patient lawsuits in the wake of KHN’s inquiry, UVA says it will continue to sue patients with incomes above a certain level.

It has also said repeatedly that changes announced last month are “a first step.”

“It seems like they’re still sorting out details of exactly what their new policy looks like,” said Elaine Poon, managing attorney at the Legal Aid Justice Center in Charlottesville, which represents some lower-income UVA patients. “We want UVA to hold off — to suspend collections until they have a new policy.”

UVA has said little publicly about its new policies almost two months since it announced them, beyond posting a guidelines and directing patients to a phone number with an intricate voice menu asking for a “guarantor account number.” Some patients said they didn’t understand what that means.

The website says nothing about reopening old cases for those already hit with garnished wages, court judgments or even UVA liens on their homes.

“I haven’t heard from UVA,” said Paul Baker, 41, a former yard maintenance worker who along with his wife owes the system more than $500,000 for treatment after a devastating truck accident in 2018.

Under the new rules, Baker’s stated income of about $24,000 might qualify him for relief.

UVA is updating its website and stocking clinics with cards in English and Spanish with contact information for patients having trouble with bills, said health system spokesman Eric Swensen. For patients meeting the new rules, it is halting or reversing the seizure of Virginia’s special tax refund of up to $220, being issued this fall, he said.

UVA has granted easier payment terms to hundreds of patients, stopped renewing wage garnishments for patients who qualify and suspended or dismissed more than 500 lawsuits since Sept. 12, Swensen said.

For now, however, that doesn’t help Robert Turkiewicz, who lost a case the day before, on Sept. 11, and faces a UVA judgment for $96,779 and attorney fees of $14,517, court documents show. Given his experience with the UVA billing office, he’s not sure it ever will.

A carpenter and construction worker who lives in Luray, Va., Turkiewicz, 44, accidentally shot himself in the leg a year ago while taking a pistol out of a truck to kill chickens. He and his wife make about $22,000 a year, he said. That’s well within UVA’s new income guidelines for erasing his entire bill.

But his stated income falls within UVA’s old guidelines for at least partial financial assistance ― and he never obtained it. A UVA billing clerk kept asking for copies of pay stubs that didn’t exist because he had been badly wounded and couldn’t work, he said.

“I knew I couldn’t afford it and I told them I couldn’t afford it,” he said. “And they said, ‘Well, you’ll get the charity care.’ And I never did get it.”

On paper, UVA’s amended policy makes it easier to qualify for financial assistance, awarding aid to families with incomes of up 400% of federal poverty guidelines, or about $100,000 for a family of four with less than $50,000 in assets, besides a home.

A family of four with income below about $50,000 would qualify for a full write-off under the new rules. UVA also has said it won’t usually sue families earning less than 400% of poverty guidelines, and will increase the discount off hospital list charges for all uninsured patients from 20% to at least 40%. It has said it will not refund money already collected.

The health system is appointing a “billing and collections advisory council” of medical and community leaders to consider further changes, leaving open the possibility it could increase discounts for the uninsured or reduce balances for people treated before the July 2017 cutoff.

The system’s collections policies have included canceling enrollment for University of Virginia students who owe medical bills. UVA has hinted it would reconsider this.

But “I’m still blocked,” said Nacy Sexton, whose UVA education was interrupted in 2014 by a hospital bill that he is still paying off. “UVA has not reached out to me.”

Even closed cases can leave families heavily indebted or stripped of savings.

“I paid every penny to them, but I still owe $25,000 to a friend of mine,” said Priti Chati, 51, who lives in Roanoke. UVA sued Chati, whose case KHN described in a previous story, for treatment of a brain tumor in 2011.

Those with old bills and legal judgments say they hope the advisory council will urge UVA to make the new policies effective further back than July 2017.

UVA is dunning money from Nunez for a five-year-old bill, taking $602 from her Virginia tax refund in April, a letter the state sent her shows.

Klein and Miller’s experience with big UVA Health bills began in the early 2000s after he hurt his wrist badly in a lawnmower accident. Multiple surgeries drove up the bills, which their daughter eventually paid with her money.

They deeded their house to her in 2012 for a few dollars to pay her back, Klein said, with UVA effectively taking their home equity. Then they moved into her mother’s house, built in the 1870s, near Quicksburg.

Since 2012, Miller has been fighting lung cancer and has tumors on his bladder and kidney. His insurance has paid more than $100,000 for treatment at Sentara RMH Medical Center in Harrisonburg, with the hospital awarding more than $400,000 in financial assistance based on his income, said Sentara spokesman Neil Mowbray.

But in 2016, doctors said he needed radiation therapy available only at UVA Health, which was out of network. The plan still paid UVA at least $64,000, insurance documents show. But UVA billed and sued the couple for $129,133. They’re paying $100 a month.

They make about $25,000 a year, said Klein, adding that UVA denied their previous financial assistance application. Their income is within the new UVA guidelines for patients to be considered for a full write-off of the bill.

But because the treatment was in 2016, before the July 2017 cutoff, she fears UVA will have a claim on her Quicksburg home, the one she grew up in, with her mother now buried nearby.

“I was furious,” she said. “Here we are going through this again, and this is our family homeplace. That’s all Mom wanted — she wanted it left with the family.”

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Sen. Grassley Questions UVA Health On Findings From KHN Investigation /news/sen-grassley-questions-uva-health-on-findings-from-khn-investigation/ Thu, 17 Oct 2019 20:20:59 +0000 https://khn.org/?p=1010621 In response to a Kaiser Health News investigation into the University of Virginia Health System’s aggressive collection practices, Senate Finance Committee Chairman Chuck Grassley (R-Iowa) sent Thursday demanding answers to questions about UVA’s billing practices, financial assistance policies and even its prices.

The Finance Committee oversees federal tax laws, and Grassley wrote that it is “my job to make sure that entities exempt from tax are fulfilling their tax-exempt purposes.”

The KHN investigation found that UVA Health System, a taxpayer-supported and state-funded entity, filed 36,000 lawsuits for more than $106 million in six years.

“Unfortunately, I have seen a variety of news reports lately discussing what appear to be relentless debt-collection efforts by tax-exempt hospitals, including UVA Health System,” Grassley wrote. “I am also concerned about how patients’ hospital bills get so high in the first place.”

Even though the letter questions only UVA Health System, whose practices were pegged in the investigation as particularly aggressive, it sends a signal that the Senate will be paying attention to an issue that affects all state-run and nonprofit health systems. Many medical providers pursue patients for unpaid bills, sometimes forcing them into bankruptcy. Several have highlighted at other nonprofit hospitals.

Nonprofit hospitals get big tax breaks in exchange for providing “charity care and community benefit,” though there is no clear standard about what that should mean. Experts have questioned whether those breaks are deserved, given hospitals’ pricing, billing and collections practices.

In the seven-page letter, Grassley asks 19 detailed questions on various topics, including the system’s charity care (free or discounted care provided to low-income patients), debt collection policies, and its rationale for the litigation threshold of $1,000, enacted in 2017. Grassley asks specific questions about UVA’s list of standard prices for procedures and equipment, commonly known as the “chargemaster,” which is posted on its website.

The letter was addressed to CEO Pamela Sutton-Wallace, who will depart UVA Health System for NewYork-Presbyterian Hospital next month. UVA Health System has until Nov. 19 to respond.

“UVA is committed to assisting indigent and uninsured patients and making sure they receive all necessary care,” UVA Health System spokesman Eric Swensen said in an email to KHN. “We will review the letter, and look forward to working with Sen. Grassley to respond to his questions and share with him the policy changes we have announced and started implementing over the past month to better serve our patients.”

In response to KHN’s investigation, UVA Health System swiftly vowed to change its policies to increase financial assistance, give bigger discounts to the uninsured and reduce its use of the legal system. However, KHN reported that some critics do not think the new policies go far enough.

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VCU Health Will Halt Patient Lawsuits, Boost Aid In Wake Of KHN Investigation /news/vcu-health-will-halt-patient-lawsuits-boost-aid-in-wake-of-khn-investigation/ Wed, 09 Oct 2019 19:58:11 +0000 https://khn.org/?p=1007420 VCU Health, the major Richmond medical system that includes the state’s largest teaching hospital, said it will no longer file lawsuits against its patients, ending a practice that has affected tens of thousands of people over the years.

VCU’s in-house physician group filed more than 56,000 lawsuits against patients for $81 million over the seven years ending in 2018, according to a Kaiser Health News analysis of district court data. Those suits will end and VCU will increase financial assistance for lower-income families treated at the $2.16 billion system, according to Melinda Hancock, VCU’s chief administrative and financial officer.

Kaiser Health News recently reported that UVA Health, the University of Virginia system, had filed more than 36,000 suits over six years against patients who could not pay their bills. That revelation, published last month in , led UVA to pledge to “positively, drastically” reduce patient lawsuits.

VCU’s new stance on lawsuits goes beyond UVA’s, which promised to stop suing only patients whose income is below 400% of poverty guidelines. UVA officials did not respond to requests for comment.

VCU’s flagship hospital, VCU Medical Center, hasn’t filed patient suits in at least seven years, Hancock said in an interview this week. But its in-house physician group continued to sue patients and families for overdue bills.

That approach stopped as of last month, she said. VCU Health, a state-operated system including Richmond’s VCU School of Medicine and Community Memorial Hospital in South Hill, Va., will stop suing patients “as part of normal debt collection,” she said. It is also ending garnishment of patient wages and attaching liens to patient homes, she said.

Hancock said VCU has been considering changing its policies since last year but recent revelations about UVA “expedited” the decision. Starting in June, KHN had requested comment from VCU officials about the health system’s financial assistance and lawsuits.

“We don’t want to be part of that,” she said about patient lawsuits, which are a standard tool for many hospitals seeking to maximize revenue. “We feel that taking care of the patient’s financial health is taking care of their holistic health.”

The system, affiliated with Virginia Commonwealth University, is also considering “how we should address pending lawsuits and retrospective cases,” said spokeswoman Laura Rossacher.

VCU Health will continue to send unpaid debts to collections and report patients with overdue bills to credit agencies.

“We still need to get our bills paid,” Hancock said. “We do need to deploy reasonable collection efforts.”

Policy scholars said the new guidelines, which would make VCU’s collection and billing practices among the most liberal for Virginia hospitals, would still leave many patients vulnerable to credit downgrades, financial hardship and bankruptcy.

“This certainly seems like progress,” said Sara Rosenbaum, a health law professor at George Washington University. But even if no lawsuit is filed, “being an apparent deadbeat on a bill written off as bad debt has terrible and enduring consequences on folks.”

Negative credit reports from a hospital, even without a court case, can send families into a downward spiral, said Gerard Anderson, director of the Johns Hopkins Center for Hospital Finance and Management.

“If they send you to a collection agency, you’re not able to borrow any money because that’s going to put you in such a poor credit rating,” he said. “You cannot expect somebody to pay a $10,000 or $20,000 bill if they don’t have insurance.”

Analysts also criticized as inadequate VCU’s new discounts to the uninsured. Last year, the system started reducing list prices by 45% for those lacking coverage. The previous discount was 25%. Almost nobody pays list charges, which hospitals typically use as a starting point for negotiations with insurers.

But VCU’s average cost of care is 77% below list charges, according to 2017 government filings. That means the uninsured are still paying a big markup under the new policy.

“Most uninsured have very little income, and asking them to pay twice as much as it costs to deliver care is not appropriate,” Anderson said. “It is no wonder why so many cannot pay the bills.”

Uninsured patients paying promptly can receive discounts of up to 55%, Rossacher said. But few are able to do that.

Like UVA, VCU is raising the income threshold for patients seeking financial assistance ― in its case, awarding aid to families with income up to 300% above the federal poverty level, or $77,000 for a family of four. For most patients, the previous cutoff was 200%, or $52,000, for a family of four.

That aid threshold takes effect in November. VCU officials declined to give an estimate of what the new policies would cost the system.

KHN analyzed lawsuits filed by VCU and other hospitals using civil court data collected by Code for Hampton Roads, a nonprofit focusing on improving government technology.

“VCU Health System and its affiliated physicians are making important policy changes that are long overdue,” said Jill Hanken, a health care attorney for the Virginia Poverty Law Center. She urged “further and ongoing oversight” from lawmakers to ensure appropriate indigent care policies.

Virginia Gov. Ralph Northam, a physician, has said little publicly about the state hospitals and doctors under his leadership that often pursue patients for all they are worth.

“No one should go bankrupt because they get sick,” said Northam spokeswoman Alena Yarmosky. “Gov. Northam is glad to see health systems taking real steps to put Virginians first and address aggressive bill collection practices.”

VCU will continue reviewing its collections and assistance policies, Hancock said. “This is an ongoing process,” she said. “It doesn’t’ stop here.”

One impetus to dropping lawsuits was an increasing number of patients with health insurance who still have trouble paying, she said.

“With the rise of high-deductible plans,” in which patients pay thousands before insurance kicks in, she said, “we just felt that there are other collection efforts that were more suitable now.”

Methodology KHN analyzed civil case records from the Virginia district courts from 2012 to 2018, based on the date the case was filed. The case records were part of a dataset KHN acquired from Ben Schoenfeld, a volunteer for Code for Hampton Roads, a nonprofit focused on improving government technology. Schoenfeld compiled court records available directly from Virginia’s court system (from both Ìý²¹²Ô»åÌý courts) and posted them on the website . The analysis included all “warrant in debt” cases where the plaintiff was listed as MCV Physicians.

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UVA To Cut Back On Lawsuits Against Patients /news/uva-will-cut-back-on-lawsuits-against-patients-in-wake-of-khn-investigation/ Fri, 13 Sep 2019 15:53:55 +0000 https://khn.org/?p=996969 UVA Health System, which sues thousands of patients each year, seizing wages and home equity to collect on overdue medical bills, said Friday it would increase financial assistance, give bigger discounts to the uninsured and “reduce our reliance on the legal system.”

“This will have a huge impact on patients to the good,” Doug Lischke, the health system’s chief financial officer, said in an interview. The changes will “positively, drastically reduce the legal process” of lawsuits, garnishments and property liens.

“We believe this is much more generous than what we’re doing now.”

Lischke called the new policy “a first step” that could later include financial assistance beyond what was announced Friday. UVA also plans to ask the Virginia General Assembly to change a state law requiring state agencies, including health systems, to “aggressively collect” unpaid bills and charge 6% interest on the balance, he said.

But independent experts said the new UVA policy, which comes on the heels of a Kaiser Health News investigation detailing UVA’s aggressive collection practices, still leaves numerous patients exposed to lawsuits and crippling bills. KHN found that UVA sued patients more than 36,000 times over six years for more than $106 million, sending many families into bankruptcy. And it routinely billed uninsured patients for far more than what a typical insurance company would have paid.

By leaving family assets vulnerable and not fully discounting sticker-price charges, the new UVA guidelines remain “very tough on the poor and near-poor who have managed to amass anything of value that will help them with the daily costs of life,” said Sara Rosenbaum, a health policy professor at George Washington University.

The amended policy loosens qualifications for financial assistance, awarding aid to families with income of up to 400% of the federal poverty level, or $103,000 for a family of four. Until now, families making more than half that much were ineligible for assistance — the most restrictive rules of any major hospital system in Virginia, KHN found. Except in “unusual circumstances,” UVA won’t sue patients unless balances are more than $1,000 and families make more than 400% of the poverty guidelines, the health system said in a written statement.

“While these changes represent a step in the right direction, it’s unfortunate that UVA, a public institution, insists on still suing patients,” said Dr. Marty Makary, a surgeon and researcher at Johns Hopkins Medicine who studies hospital debt collection. “In my conversations with UVA surgeons, they are appalled by the practice of their center in suing patients and want it to stop.”

The changes take effect Jan. 1 but a UVA statement said the health system is “committed to working with anyone who currently has an outstanding balance or debt that they are struggling to pay.”

UVA has not decided what to do about patient lawsuits in the pipeline, Lischke said. Online court records show there are hearings scheduled for hundreds of UVA Medical Center cases over the next few weeks.

Mary Washington Healthcare of Fredericksburg, criticized earlier this summer for a far smaller number of lawsuits, said it would suspend suing patients and try to eliminate current garnishments. Methodist Le Bonheur Healthcare in Memphis, another on a growing list of hospitals called out for aggressive collections, said it would suspend all court activity for a month.

UVA will apply the new financial assistance and charging policies to patients treated in July 2017 or later, Lischke said. That means patients on current payment plans or with judgments against them could have bills eliminated or adjusted. But there will be no refunds of payments already made, he said.

The policies also apply to patients treated after July 2017 with judgments against them but no payment plan, he said. But there will be no refunds of payments already made, he said.

Taken together the changes will cost UVA “millions to tens of millions,” he said declining to give a more precise figure.

UVA Medical Center, the core of UVA Health, made an $87 million operating profit on revenue of $1.7 billion in the fiscal year ending in June and held stocks, bonds and other investments worth about $1 billion.

UVA began revising its billing and collections policies after being informed of KHN’s findings in August. It examined policies of neighboring hospitals such as Mary Washington as well as other major academic medical centers, Lischke said.

Previously just $4,000 in a retirement account could bar UVA patients from financial help, no matter how low their income. Now patients can have at least $50,000 in savings beyond the value of their home and car and still get assistance as long as they meet the income test, UVA said.

The nonprofit health system, a taxpayer-supported state agency, also said it would grant discounts of 40% to the uninsured to better reflect lower rates negotiated and paid by insurance companies. Previously, uninsured patients got only 20% off the sticker price plus another 10% to 15% if they paid promptly, which few could.

Shaving 40% from “chargemaster” prices used as a starting point for insurer negotiations puts bills to the uninsured in line with what a commercial health plan would pay, Lischke said.

That’s not enough, Rosenbaum said. She recommended they be lowered further to Medicare levels, which can be 75% off or more.  The total of UVA’s cash revenue from all health plans and government programs is 70% below chargemaster, financial forms filed with the Department of Health and Human Services show.

“Even a 40% write-off of charges remains a brutal exposure” for the uninsured, she said. “How could they possibly remain tied to their chargemaster and keep a straight face?”

As part of its ongoing review of billing and collections, UVA will consider further lowering charges to the uninsured — perhaps to Medicare levels, Lischke said.

The new policy also does nothing for those who were sued and garnished for treatment before July 2017.

So far the health system’s announcement doesn’t help the 20 UVA students reported by KHN to have “active holds” on their enrollment this semester because they owe money to the UVA Medical Center. UVA treats unpaid hospital bills the same as unpaid tuition.

UVA has not approached legislators yet about changing billing laws but hoped to have next year’s General Assembly consider it.

“I am hopeful that we are able to influence a change to not only the Debt Collection Act” requiring aggressive collection “but also the state indigent care guidelines,” Lischke said.

Gov. Ralph Northam, a physician who is close to Dr. L.D. Britt, a Norfolk surgeon and professor who is chairman of the health system’s board, has said nothing publicly beyond his Monday statement that “I am glad to hear the UVA Health System is in the process of changing their policies and practices.”

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UVA Suspends Medical Lawsuits In Wake Of KHN Investigation /news/uva-suspends-medical-lawsuits-in-wake-of-khn-investigation/ Thu, 12 Sep 2019 22:33:27 +0000 https://khn.org/?p=996475 CHARLOTTESVILLE, Va. — Under pressure after Kaiser Health News reported Monday that it sues thousands of patients a year and sends many into bankruptcy, University of Virginia Health System suspended about a dozen patient lawsuits Thursday and said it will announce changes to its billing and collections policy Friday.

At a weekly session at the Albemarle County Courthouse often dominated by UVA hospital litigation, UVA lawyer Melissa Riley said cases due to be heard Thursday would be withdrawn while the system takes a broader look at its long-standing practice of aggressive debt collection.

The move affects only those cases and changes nothing for thousands of patients who have already lost court judgments to UVA or face other pending lawsuits. And those cases could be refiled later.

“The university is conducting a review and may announce changes to its policies tomorrow,” Riley said.

Several patients in the courtroom and District Court Judge William Barkley said they had no comment.

UVA sued more than 36,000 patients over six years for unpaid bills for more than $106 million, KHN found.

It also seized some $22 million in patients’ state tax refunds, mostly outside the judicial process, as part of a program to help state and local governments collect debts. And it frequently billed uninsured patients for far more than what a typical insurance company would have paid.

Top officials at the health system’s quarterly board meeting Thursday morning were set to discuss billing and collections in a closed session but had little to say about the matters beforehand.

“I’m very concerned” about what KHN reported “and I’m very sympathetic” to patients caught in litigation, said James Murray, a venture capitalist who as rector serves as the head of the UVA Board of Visitors, its governing body.

As usual, the board met in UVA’s classical Rotunda, designed by Thomas Jefferson. UVA is taxpayer- and state-funded. A KHN reporter objected to the closed session, arguing that matters potentially affecting hundreds of thousands of UVA patients should be discussed publicly.

“We’re not going to discuss it in open session,” said Pamela Sutton-Wallace, the UVA Medical Center CEO who will step down in November, the university disclosed Tuesday.

Instead the board, led by L.D. Britt, a surgeon and professor at Eastern Virginia Medical School in Norfolk, celebrated a profitable fiscal year and UVA Medical Center ranking again as U.S. News & World Report’s top hospital in Virginia.

Unaudited results presented Thursday showed UVA Medical Center, the core of UVA Health, made an $87 million operating profit on revenue of $1.7 billion in the fiscal year ending in June and held stocks, bonds and other investments worth about $1 billion.

As part of its investigation into billing practices, KHN reported that UVA has the least generous patient financial assistance guidelines of any major hospital system in Virginia. Savings of only a few thousand dollars in a 401(k) account can disqualify even families with very low incomes from UVA aid.

CEO Sutton-Wallace is moving to New York-Presbyterian Hospital in November to become a senior vice president, UVA Health announced Tuesday. Her departure “is in no way related” to the billing and collections problems, UVA President James Ryan said in a message to employees.

New York-Presbyterian did not respond to multiple requests for comment.

Data editor Elizabeth Lucas contributed to this report. 

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