Report: In the course of the pandemic, the Wisconsin hospital known as for $ three million from sufferers in litigation over medical debt

From Jenny Deam

This story was originally published by ProPublica, a nonprofit newsroom investigating abuse of power. Sign up to receive the greatest stories from ProPublica as soon as they are published.

In the past year as COVID-19 besieged the nation, many U.S. hospitals drastically scaled back their aggressive tactics to collect medical debts. Some stopped altogether.

But not all.

There was a nearly 90% decrease in lawsuits from the country’s largest hospitals and health systems between 2019 and the first seven months of 2020, according to a new report from Johns Hopkins University. Still, the researchers told ProPublica that in the first seven months of 2020 they identified at least 16 institutions that had prosecuted lawsuits, garnishments, and liens against their patients.

The Johns Hopkins findings, released Monday in partnership with Axios, the first to report the findings, are part of an ongoing series of state and national reports addressing debt collections by U.S. hospitals and healthcare systems from 2018 to 2020.

In those years, more than a quarter of the country’s largest hospitals and health systems were pursuing nearly 39,000 legal actions for more than $ 72 million, according to data from Johns Hopkins researchers obtained from state and district court records.

More than 65% of the entities identified were not-for-profit, which means that in return for the tax exemption, they are intended to serve the public rather than the private interest.

The amount of medical debt that individuals owe is often a small fraction of a hospital’s total revenue – only 0.03% of annual revenues – but can “create a devastating financial burden on working families,” the report said. The Federal Consumer Financial Protection Bureau estimates that medical debt accounts for 58% of all debt collections.

The poor or uninsured often bear the brunt of such actions, said Christi Walsh, clinical director of health care and research policy at Johns Hopkins University. “In times of crisis you can see the big differences,” she said.

The researchers said they couldn’t figure out all of the amounts requested by the 16 institutions that took legal action in the first half of 2020, but it was from these that Froedtert Health, a health care system in Wisconsin, was able to collect the most money from patients – more than $ 3 million.

Even after Wisconsin Governor Tony Evers declared a public health emergency on March 12, 2020, hospitals within the Froedtert Health System filed more than 100 cases from mid-March to July, researchers reported, and 96 of the measures were liens.

A lien was on Tyler Boll-Flaig, a 21-year-old uninsured pizza delivery company from Twin Lakes, Wisconsin, who on 3rd Boll-Flaig’s jaw was shattered, four vertebrae were crushed and several ribs were broken. His 14-year-old brother Dominic Flaig, who was out that night, was killed.

Days after the crash, her mother, Brandy Flaig, said she received a call from a hospital clearing house asking for her surviving son’s contact information in order to set up a payment plan for his medical bills.

Then, on July 30, less than two months later, Froedtert Hospital in Milwaukee filed a pledge of $ 67,225 against Boll-Flaig. According to the Wisconsin Circuit Court Access website used by researchers and verified by ProPublica, it was one of seven mortgage bonds the hospital filed on the same day, valued at nearly a quarter of a million dollars.

“It’s during the pandemic, we’re still grieving, and you are following Tyler?” said Flaig. “It’s predatory.” Tyler Boll-Flaig declined to be interviewed.

The emergency entrance to Froedtert Hospital in Milwaukee can be seen on November 1, 2019. Researchers at Johns Hopkins University told ProPublica that in the first seven months of the year they identified at least 16 US medical facilities pursuing lawsuits, garnishments, and liens against their patients in 2020 – a time when many hospitals are revolting Tactics to collect medical debt have drastically reduced. The researchers said they couldn’t figure out all of the amounts requested by the 16 institutions that took legal action in the first half of 2020, but it was from these that Froedtert Health, a health care system in Wisconsin, was able to collect the most money from patients – more than $ 3 million. (Corrinne Hess / WPR)

The Froedtert Hospital is the largest in the Froedtert Health System, which comprises five full-service hospitals, two community hospitals and more than 40 clinics. The health system reported operating income of more than $ 53 million for the quarter ended September 30, 2020 – double the prior year, according to its financial records. It has also raised $ 90 million in federal CARES bill to help with its COVID-19 response and operational costs, a spokesman said.

Only the Reedsburg Area Medical Center, a nonprofit hospital in Reedsburg, Wisconsin, took further legal action in the spring and summer of 2020 with 139 lawsuits and 22 garnishments, the study found. Medical center officials did not respond to a request for comment.

In contrast, advocacy Aurora Health, the state’s most sued pre-pandemic health network, fell to zero court filings after February 2020, the report said.

Stephen Schoof, a spokesman for Froedtert Health, said in an email that he was unable to comment on the Boll-Flaig case due to patient privacy laws. He also said the health system was unable to comment on the Johns Hopkins study because it had not yet reviewed all of the results. But Schoof denied the numbers sent to him by ProPublica, calling them “inaccurate and misleading”.

Schoof protested how researchers defined and counted legal steps. He said Froedtert Hospital stopped filing small claims lawsuits in March 2020 but continued to pursue liens on patients involved in accidents that could lead to settlements.

“The lien has no impact on a patient’s personal property and is intended to offset the costs from the settlement proceeds of the negligent party’s insurance company,” he said.

That was the case with Boll-Flaig. Jason Abraham, Boll-Flaig’s attorney, told ProPublica that the lien will be handled with the hospital. He said the amount is covered by motor vehicle liability insurance and workers’ compensation insurance since Boll-Flaig was on duty at the time of the accident.

Liens allow hospitals to get paid quickly and, according to state law, must be filed within 60 days of hospital discharge. Because he was hospitalized during the pandemic, Boll-Flaig was released after about 24 hours, his mother said.

Abraham said the hospital “tried to get to the top because they think a pool of money is available”.

Wisconsin Watch, a not-for-profit news agency, reported late last year that Froedtert Hospital had filed 362 liens as of December 11, including 251 after May. That was more than the 300 liens filed throughout 2019, the news investigation found.

In New York, the Johns Hopkins researchers found that between January 2018 and mid-December 2020, 51 hospitals filed legal action against more than 1,800 patients. More than half came from just one health system: Northwell Health, a nonprofit that is the largest in the state, operates 19 hospitals across the state, with affiliations to four others.

The most contentious in the Northwell system during this time was the Long Island Jewish Medical Center, which filed a total of 2,011 lawsuits, more than a quarter of which were prosecuted in the past year, the investigation found.

“During the first wave of the COVID-19 pandemic, most hospitals significantly reduced or even dropped all medical debt lawsuits. However, when the first wave of the pandemic subsided, many New York hospitals resumed operations as usual, ”the study says.

Although he hadn’t seen the Johns Hopkins report, Rich Miller, executive vice president of Northwell Health, said he was skeptical of the results, in part because the health system stopped all legal action against patients from April to September last year.

Northwell resumed filing cases for about two months in the fall of 2020 but has since stopped. Every case that was filed during the brief retrial has now been withdrawn, he said.

Miller said his health system was not taking legal action against Medicaid patients, those over 65, the unemployed, people with disabilities or the military. Patients will only be prosecuted if they have ignored attempts to work out payment plans or if they have “strong solvency,” he said.

All hospitals have specific guidelines and steps to follow before using debt collection as a last resort, said Marie Johnson, vice president of media relations for the American Hospital Association.

Health systems must balance the need for adequate funding with “treating all people equally with dignity, respect and compassion,” Johnson said.

Still, the problem shows the obscurity of the US health care system, said Nicholas Bagley, a law professor at the University of Michigan who specializes in health law. “Sometimes we treat it like a commodity, sometimes we treat it like a right,” he said. “That’s just personal debt in the eyes of the law.”

However, he questioned the wisdom of equating unpaid medical bills, which are often incurred in emergencies or crises, with an overdue credit card: “Is this how we really want to handle payment disputes?”

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