A recentreport from Community Service Society, an advocacy and research group, found hospital systems across New York placing liens on hundreds of patients’ homes because of outstanding medical debt from 2017-2018.
"This extreme collection practice predominately occurs outside of New York City. For example, 35% of all liens were placed on patients by hospitals located in the Capital District (St. Peter’s Health Partners, Albany Medical Center and Ellis Hospital)," the report said.
Schuyler County had the highest per capita number of liens in the state, with Schuyler Hospital, part of Cayuga Health System, placing 134 liens.
In New York, if a patient is sued over unpaid medical bills and loses in court, a hospital can place a lien on their home. When the house is sold, a portion of the money goes towards paying off the debt. Hospitals cannot foreclose on the home, but liens can damage a person’s credit, make it difficult to resell their home and keep them from qualifying for loans.
Elisabeth Benjamin, vice president of health initiatives at CSS and one of the authors of the report on predatory practices, said hospitals are directly impacting the well-being of patients by placing liens on their homes.
“You’re ruining their economic lifeline, you’re ruining their credit, you’re causing them untold mental anguish, and it’s just not okay,” Benjamin said.
In New York, the median amount of medical debt patients are sued for is around $1,900, according to an earlier study by CSS. The research also found that many hospitals did not stop suing patients over medical debt during the pandemic, and at times even garnished patients’ wages.
"Putting liens on patients' homes for an average claim of $1,900 is outrageous," said Assembly Health Committee Chair Richard Gottfried (Assembly District 75). "I appreciate that most hospitals don't do this, but too many do and too many people's finances are destroyed by it."
Benjamin argued that suing patients over medical debt is in direct opposition with the stated mission of New York’s nonprofit hospitals.
“The first tenet in medicine is to do no harm,” Benjamin said. “Suing people, filing liens on their homes, ruining their credit…that’s doing harm.”
New York’s hospitals get state funding to help them provide financial assistance to lower income patients. The report found that the 56 hospitals putting liens on patients’ homes simultaneously received $442 million in those state funds.
The report also found that people being sued often lived in low-income counties and neighborhoods. Benjamin said that could mean that some of the patients being sued were actually eligible for financial assistance.
“Eighty percent of the liens are being filed in counties where the median income is well below the hospital financial assistance law eligibility ceiling,” Benjamin said.
Erie County Medical Center, Western New York's safety net hospital, placed three liens on primary residences 2017-2018, from which it received nearly $7 million.
She said part of the problem is many patients don’t know they qualify for financial assistance, and aren’t offered it by hospitals. Financial assistance application forms can be difficult to find and onerous to fill out, she said.
“Patients get really, you know, paralyzed, in the sort of spider web of insurance companies, hospitals, collection offices, collection agents,” Benjamin said. “It’s just so terrifying for patients.”
If you get a bill you can’t pay, Benjamin said to call your insurance company and find out why they didn’t pay for the service. If you are still stuck with the bill, seek out financial assistance information through the hospital’s website. She said not to sign a repayment plan if you don’t think you can afford it.
Patients who are sued should seek help and fight back in court, she added, especially if they think they might have qualified for financial aid.
“Go to court, tell the judge, ‘they never offered me financial aid. I am eligible for financial aid.’ But don’t ignore a lawsuit,” Benjamin said. “Go to court, tell your story.”
Thirteen states have laws that protect patients’ homes when they’re sued for medical debt. New York isn’t one of them. But there aretwo bills in the state Legislature that would stop hospitals from placing liens on people’s homes and from garnishing wages, and would reform the hospital financial aid application system.
Bassett Healthcare Network said in a statement on Monday that the hospital system is taking steps to stop the practice and review previous liens taken.
“We believe that everyone should have access to high quality health care – regardless of their financial resources,” the statement read. “Further, paying for health care should never put a family’s home or economic security in jeopardy.”
Dr. Edmund Sabanegh, Guthrie’s president and CEO, said as of early November, the hospital system will no longer take liens on patients’ homes.
“People should not avoid going to Guthrie because of an inability to pay,” said Sabanegh. “So basically once we understood this practice, we cancelled it essentially the same day.”
He added that Guthrie’s hospitals in Corning and Cortland received $800,000 in state funding, but provided almost $9 million in uncompensated care. He said Guthrie is actively reviewing all of their procedures to make sure the hospital system properly serves the population.
Have you been sued for medical debt? Have a tip? Phoebe Taylor-Vuolo covers rural health in the Southern Tier. Contact her at 607-729-0100 ext. 384 or ptaylorvuolo@wskg.org.
CSS Hospital Report by Marian on Scribd