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<\/a>UVA Health System treated Heather Waldron in 2017 for complications from an intestinal malformation. (Griffin Pivarunas for Kaiser Health News)<\/p><\/div>\n
By Jay Hancock and Elizabeth Lucas
\nThe Washington Post<\/p>\n
Heather Waldron and John Hawley are losing their four-bedroom house in the hills above Blacksburg, Va. A teenage daughter, one of their five children, sold her clothes for spending money. They worried about paying the electric bill. Financial disaster, they say, contributed to their divorce, finalized in April.<\/p>\n
Their money problems began when the University of Virginia Health System pursued the couple with a lawsuit and a lien on their home to recoup $164,000 in charges for Waldron\u2019s emergency surgery in 2017.<\/p>\n
The family has lots of company: Over six years ending in June 2018, the health system and its doctors sued former patients more than 36,000 times for over $106 million, seizing wages and bank accounts, putting liens on property and homes and forcing families into bankruptcy, a Kaiser Health News analysis has found.<\/p>\n
Unpaid medical bills are a leading cause of personal debt and bankruptcy, with hospitals from\u00a0Memphis<\/a>\u00a0to\u00a0Baltimore<\/a>\u00a0criticized for their role in pushing families over the financial edge. But UVA Health System stands out for the scope of its collection efforts and how persistently it goes after payment, pursuing poor as well as middle-class patients for almost all they\u2019re worth, according to court records, hospital documents and interviews with hospital officials and dozens of patients.<\/p>\n UVA sued patients for as little as $13.91 and as much as $1 million during most of that period, until July 2017, when it restricted lawsuits to those owing more than $1,000, the analysis shows.<\/p>\n Every year, the health system sued about 100 of its own employees who also happened to be patients. It garnished thousands of paychecks, largely from workers at lower-pay employers such as Walmart, where UVA took wages more than 800 times.<\/p>\n Under a Virginia program designed to help state and local governments collect debt, it also seized $22 million in state tax refunds to patients with outstanding medical bills in the last six fiscal years \u2014 most of it without court judgments, said health system spokesman Eric Swensen.<\/p>\n Over many years, it filed thousands of property liens from Albemarle County all the way to Georgia.<\/p>\n Beyond its recovery of debts, UVA hit some former patients with an additional 15 percent for legal costs, plus 6 percent interest on their unpaid bills, which over the course of years can add up to more than the original bill.<\/p>\n The health system also has the most restrictive eligibility guidelines for financial assistance to patients of any major hospital system in Virginia, interviews and written policies show. Savings of only $4,000 in a retirement account can disqualify a family from aid, even if its income is barely above poverty level.<\/p>\n The hospital\u00a0ranked No. 1 in Virginia<\/a>\u00a0by U.S. News & World Report is taxpayer supported and state-funded, not a company with profit motives and shareholder demands. Like other nonprofit hospitals, it pays no federal, state or local taxes on the presumption it offers charity care and other community benefits valued at least as much as those breaks. Gov. Ralph Northam (D), a pediatric neurologist, oversees its board.<\/p>\n UVA officials\u00a0defended the institution\u2019s practices as legally required and necessary<\/a>\u00a0\u201cto generate positive operating income\u201d to invest in medical education, new facilities, research and the latest technology.<\/p>\n They point to the\u00a0Virginia Debt Collection Act of 1988<\/a>, which requires state agencies to \u201caggressively collect\u201d money owed.<\/p>\n During the six-year period studied, UVA had an estimated six million visits and cared for those patients \u201cregardless of their ability to pay,\u201d said Swensen, the health system spokesman.<\/p>\n \u201cFor the vast majority of patients, we are able to agree upon workable payment plans without filing a legal claim,\u201d he said. Suing patients or using collection agencies are \u201ca last resort,\u201d he added.<\/p>\n Before patients got court summons, they would have received \u201cfour to five\u201d bills over several months, along with instructions about how to apply for financial assistance, Swensen said.<\/p>\n During the most recent fiscal year, which ended in June, he said, UVA approved almost 10,000 applications for assistance under charity care guidelines set by the state. Most of those patients paid nothing beyond a $6 co-pay.<\/p>\n In addition, UVA is undertaking \u201ca comprehensive review\u201d of its charity care rules and \u201cconsidering policies to provide additional financial assistance to low-income patients,\u201d he said.<\/p>\n Swensen declined to discuss the circumstances of individual patients, saying the hospital was bound by patient confidentiality. UVA Health CEO Pamela Sutton-Wallace declined an interview request. A spokeswoman for Northam did not respond to repeated requests for comment.<\/p>\n Though there is no national data on hospital debt collection, UVA\u2019s pursuit of patients goes beyond that of a number of other institutions.<\/p>\n Johns Hopkins Hospital in Baltimore has sued roughly 240 patients a year on average since 2009, according to\u00a0a May report in the Baltimore Sun<\/a>. UVA, by comparison, often sues that many former patients in a week, and averages more than 6,000 cases a year, court data show.<\/p>\n Private, nonprofit Yale New Haven Health System files liens only if a bill is over $10,000, and then only if the property is worth at least $300,000, a spokesman said. Falls-Church, Va.-based Inova Health says it does not file liens on patient homes or garnish wages.<\/p>\n Tenet Healthcare, a national, for-profit chain whose stock trades on Wall Street, says it does not sue uninsured patients who are unemployed or who lack significant assets other than their house.<\/p>\n Industry standards are few and vague. The American Hospital Association says its members follow Internal Revenue Service guidelines, which merely require hospitals to have a financial assistance policy and to make \u201creasonable efforts\u201d to determine whether a patient qualifies for help before initiating collections.<\/p>\n Patients find themselves unable to pay UVA bills for many reasons: They are uninsured or sometimes have short-term coverage that does not pay for treatment of preexisting illnesses. Or they are out of network, or have a \u201chigh-deductible\u201d plan \u2014 increasingly common coverage nationwide that can require patients to pay more than $6,000 before insurance kicks in. Virginia\u2019s Medicaid expansion, which took effect this year, covers families with low incomes but is still projected to leave hundreds of thousands uninsured.<\/p>\n Patients also have trouble because like many U.S. hospitals, UVA bills people lacking coverage at rates far higher than what insurance companies pay on behalf of their members. Such bills often have little connection to the cost of care, experts say. Insurers obtain huge discounts off hospital sticker prices \u2014 70 percent on average in UVA\u2019s case, according to documents it files with Medicare.<\/p>\n UVA offers uninsured patients 20 percent off to start and another 15 to 20 percent if they pay promptly, Swensen said. Few are able to do that. Patients are subject to collections and lawsuits if they do not pay, or arrange to do so, within four months, he said.<\/p>\n The $164,000 billed to Waldron for intestinal surgery was more than twice what a commercial insurer would have paid for her care, according to benefits firm WellRithms, which analyzed bills for Kaiser Health News using cost reports UVA files with the government. Charges on her bill included $2,000 for a $20 feeding tube.<\/p>\n UVA would not disclose basic information about patient lawsuits, liens and garnishments. Reporters reconstructed the hospital\u2019s practices by talking directly with patients, analyzing court documents and hospital bills and observing the legal process in court. They gathered records in Charlottesville to supplement a courts database compiled by nonprofit Code for Hampton Roads, which works to improve government technology.<\/p>\n The picture that emerges is one of little accountability for UVA\u2014 or of redress for its patients.<\/p>\n Waldron, 38, an insurance agent and former nurse, appreciates the treatment she received for an intestinal malformation that almost killed her. But, she says, \u201cUVA has ruined us.\u201d<\/p>\n District Court Judge William Barkley doesn\u2019t announce the UVA cases as he takes the bench each Thursday in the historic brick courthouse in Charlottesville. At one hearing in March, he waves a thick stack of litigation at defendants, asking, \u201cIs anybody here for a hospital case?\u201d<\/p>\n A recent\u00a0NPR report<\/a>\u00a0noted that nonprofit Mary Washington Healthcare, in Fredericksburg, Va., had 300 cases in court in one month. (The hospital said it was suspending such patient suits after that report.) Barkley\u2019s court often handles 300 UVA suits in a week, court data show.<\/p>\n The health system sends collections representatives, not lawyers, who sit near the judge\u2019s bench. They give patients two weeks to commit to an interest-free payment plan, according to courtroom meetings witnessed by a reporter. Otherwise, \u201cwe\u2019re already going to be reviewing it for garnishment,\u201d a UVA official tells a car accident victim. With bills often in the tens of thousands of dollars, even the five-year, interest-free plans are unaffordable, patients said.<\/p>\n Swensen said those deadlines are imposed at least 150 to 200 days after they were sent their first bills.<\/p>\n Zann Nelson, sued by UVA for $23,849 a few years ago, is a rare patient who fought back. The now 70-year-old Reva resident was admitted with newly diagnosed uterine cancer, bleeding and in pain when she signed an open-ended payment agreement. In court, she argued it was so vague as to be unenforceable.<\/p>\n She lost. The judge, according to court records, said that Nelson had \u201cthe ability to decline the surgery\u201d if she didn\u2019t like the terms of the deal. She lived with a lien on her farm until she managed to pay off the debt.<\/p>\n The medical center, the flagship of UVA Health System, earned $554 million in profit over the six years ending June 2018, and holds stocks, bonds and other investments worth $1 billion,\u00a0according to financial statements.<\/a>\u00a0CEO Sutton-Wallace makes $750,000, with bonus incentives that could push her annual pay close to $1 million, according to\u00a0a copy of her employment contract<\/a>, obtained under public information law.<\/p>\n Yet UVA offers more limited financial assistance than any other major health system in Virginia, according to an analysis of policies at organizations including Inova, Sentara Healthcare, Riverside Health and Carilion Clinic.<\/p>\n To qualify for help, UVA patients must earn less than 200 percent of federal poverty guidelines and own less than about $3,000 in assets, not counting a house, according to the hospital\u2019s website and guidelines UVA files with the state.<\/p>\n Carilion Clinic, by contrast, provides aid to families with income up to 400 percent of poverty guidelines and assets less than $100,000 other than a house. If bills at Riverside Health exceed household income over 12 months,\u00a0the hospital forgives the whole amount.<\/a><\/p>\n The only other policy in Virginia similar to UVA\u2019s is that of VCU Health, a sister state hospital system with the same income and asset guidelines. In July, VCU said it started offering help to some patients with \u201ccatastrophic\u201d and \u201cprohibitively expensive\u201d bills who don\u2019t otherwise qualify.<\/p>\n \u201cWe are considering those updates,\u201d Swensen said of VCU\u2019s changes.<\/p>\n UVA sued Carolyn Davis, 55, of Halifax County, for $7,448 to pay for nerve injections to treat back pain that she hadn\u2019t realized would be out of network.<\/p>\n Her husband is a cook at Hardee\u2019s, taking home $500 to $600 a week, she said. UVA refused their application for financial assistance because his Hardee\u2019s 401(k) balance of $6,000 makes them too well off, she said.<\/p>\n \u201cWe don\u2019t have that kind of money,\u201d Davis said. The hospital insisted on a monthly payment of $75. She was meeting it by charging it to her credit card at 22 percent interest.<\/p>\n Charges for Davis\u2019s treatment were about twice as much as what a commercial insurer would have paid, according to an estimate by WellRithms.<\/p>\n Leigh Ann Beach, 37, of Palmyra experienced how differently hospitals treat those who cannot pay after hurting her ankle in a bike accident.<\/p>\n Sentara Martha Jefferson Hospital, which first treated her, canceled the entire $4,650 bill based on her family\u2019s income and the need to support her seven children, her paperwork shows. UVA, where she got surgery and metal implants, sued her for $9,505 and rejected her request for financial help.<\/p>\n A UVA representative said she could sell some acreage from her small rural home to pay the bill, she said. She limps and is in pain, but \u201cI can\u2019t afford to go back,\u201d she said.<\/p>\n When Jesse Lynn, 42, of Orange County, bought short-term coverage to tide him over between policies, he and his wife, Renee, didn\u2019t realize the plan considered Jesse\u2019s old back problems a preexisting illness, and therefore would not pay for treatment.<\/p>\n After back surgery at Culpeper Medical Center, a UVA affiliate, he came out with a bill for about $230,000, Renee Lynn said.<\/p>\n The surgeon reduced his portion of the charges \u2014 from $32,000 to $4,500, which they thought was reasonable. They asked for a similar break or a payment delay from UVA \u201cWe are not a lending institution,\u201d the billing office told her, she said.<\/p>\n The Lynns decided bankruptcy was their only option.<\/p>\n \u201cI probably see at least a couple a month,\u201d said Marshall Slayton, a Charlottesville bankruptcy lawyer, holding up a new file. \u201cThis is the third case this week.\u201d<\/p>\n UVA says it doesn\u2019t foreclose on primary residences. But often a UVA lawsuit leads to home loss because patients\u2019 credit is downgraded and they cannot keep up with hospital payment plans and mortgages.<\/p>\n Property liens do give UVA a claim on the equity in patients\u2019 homes.<\/p>\n \u201cWe see a lot of them,\u201d said Tina Merritt, a partner with True North Title in Blacksburg. \u201cAnd a lot of people don\u2019t even know until they go to sell the property.\u201d<\/p>\n It took Priti Chati, 62, of Roanoke six years to pay a $44,000 UVA bill for brain surgery and have a home lien removed last year, court records show. The health system seized bank funds intended for her daughters\u2019 college costs, she said. She sold jewelry and borrowed from friends, eventually paying more than $70,000 including interest, she said.<\/p>\n Paul Baker, 41, of Madison County, ran a small lawn service and with his wife, owes more than $500,000 for treatment after their truck rolled over. He is grateful to UVA \u201cfor saving my life,\u201d he says. But he is \u201cfrustrated they are ultimately taking my farm\u201d when he sells or dies, as a result of UVA\u2019s lawsuit.<\/p>\n Swensen said the medical center gave $322 million in financial assistance and charity care in fiscal 2018. But legal and finance experts say that\u2019s not a reliable estimate.<\/p>\n The $322 million \u201cmerely indicates the amount they would have charged arbitrarily\u201d before negotiated insurer discounts, said Ge Bai, an accounting and health policy professor at the Johns Hopkins Carey Business School.<\/p>\n The figure is \u201cbased on customary reporting standards used by hospitals across the U.S.,\u201d Swensen said.<\/p>\n Insurers would have paid UVA only $88 million for that care, according to\u00a0an accounting of unpaid bills\u00a0<\/a>presented last year to the UVA Health board. Even that unpaid figure didn\u2019t come out of UVA\u2019s purse since federal and state governments provided \u201cfunding earmarked to cover indigent care\u201d for almost all of it \u2014 $83.7 million, according to Bai.<\/p>\n The real, \u201cunfunded\u201d cost of UVA\u2019s indigent care: $4.3 million, or 1.3 percent of what it claims, according to the document.<\/p>\n \u201cThat\u2019s nothing,\u201d given how much money UVA makes, Bai said. \u201cNonprofit hospitals advance their charitable mission primarily through providing indigent care.\u201d<\/p>\n The hospital recorded another $109 million in uncollectible debts not considered indigent care, the document shows.<\/p>\n Nacy Sexton, who is in his 30s and lives outside Richmond, hoped he might get a break on his medical bills as a student enrolled at the University of Virginia. He was close to finishing a bachelor\u2019s degree in 2015 when he was hospitalized for lupus. When he was unable to cover the reduced bill offered by the hospital, the university blocked his enrollment,\u00a0a notice he received from student financial service<\/a>s shows.<\/p>\n \u201cThe university places enrollment holds on student accounts for many reasons, including unpaid tuition and medical bills,\u201d said university spokesman Wesley Hester. This semester, the university has \u201cactive holds\u201d on 20 students because of unpaid health system bills, which might or might not block their attendance, depending on when the hold was placed, he said.<\/p>\n Sexton still has about $4,000 to go on a bill that he said was more than $30,000 before UVA\u2019s discount, a fundraising campaign and other payments. He hopes to re-enroll and finish his degree in education next year.<\/p>\n \u201cWhen you get sick, why should it affect your education?\u201d he asked.<\/p>\n Shirley Perry, once a registered nurse at UVA, became chronically ill, lost her job and insurance, and then needed treatment from her former employer. UVA sued her for $218,730 plus $32,809 in legal fees. She died last year at age 51, with a UVA lien on her townhouse. It was auctioned off on Aug. 7 at the Albemarle County Courthouse.<\/p>\n For Heather Waldron, the path from \u201chaving everything and being able to buy things and feeling pretty good\u201d to \u201cdevastation\u201d began when she learned after her UVA hospitalization that a computer error involving a policy bought on HealthCare.gov had led her insurance to lapse.<\/p>\n She is now on food stamps and talking to bankruptcy lawyers. A bank began foreclosure proceedings in August on the Blacksburg house she shared with her family. The home will be sold to pay off the mortgage. She expects UVA to take whatever is left.<\/p>\n‘Here for a hospital case?’<\/h3>\n
‘Can’t afford to go back’<\/h3>\n
Resorting to bankruptcy<\/h3>\n
Indigent care<\/h3>\n
Waldron’s ‘devastation’<\/h3>\n
![\u00a0a notice he received from student financial service<\/a>s shows.<\/p>\n\u201cThe university places enrollment holds on student accounts for many reasons, including unpaid tuition and medical bills,\u201d said university spokesman Wesley Hester. This semester, the university has \u201cactive holds\u201d on 20 students because of unpaid health system bills, which might or might not block their attendance, depending on when the hold was placed, he said.<\/p>\nSexton still has about $4,000 to go on a bill that he said was more than $30,000 before UVA\u2019s discount, a fundraising campaign and other payments. He hopes to re-enroll and finish his degree in education next year.<\/p>\n\u201cWhen you get sick, why should it affect your education?\u201d he asked.<\/p>\nShirley Perry, once a registered nurse at UVA, became chronically ill, lost her job and insurance, and then needed treatment from her former employer. UVA sued her for $218,730 plus $32,809 in legal fees. She died last year at age 51, with a UVA lien on her townhouse. It was auctioned off on Aug. 7 at the Albemarle County Courthouse.<\/p>\nWaldron’s ‘devastation’<\/h3>\nFor Heather Waldron, the path from \u201chaving everything and being able to buy things and feeling pretty good\u201d to \u201cdevastation\u201d began when she learned after her UVA hospitalization that a computer error involving a policy bought on HealthCare.gov had led her insurance to lapse.<\/p>\nShe is now on food stamps and talking to bankruptcy lawyers. A bank began foreclosure proceedings in August on the Blacksburg house she shared with her family. The home will be sold to pay off the mortgage. She expects UVA to take whatever is left.<\/p>\nHancock is a senior correspondent and Lucas is Data Editor for\u00a0Kaiser Health News<\/a>\u00a0(KHN), a nonprofit news service covering health issues. It is an editorially independent program of the Kaiser Family Foundation that is not affiliated with Kaiser Permanente.<\/p>\n___\nhttps:\/\/www.washingtonpost.com\/health\/uva-has-ruined-us-health-system-sues-thousands-of-patients-seizing-paychecks-and-putting-liens-on-homes\/2019\/09\/09\/5eb23306-c807-11e9-be05-f76ac4ec618c_story.html<\/p>\n","protected":false},"excerpt":{"rendered":"\u2018UVA has ruined us\u2019: Health system sues thousands of patients, seizing paychecks and putting liens on homes<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-127976","post","type-post","status-publish","format-standard","hentry","category-uncategorized"],"_links":{"self":[{"href":"https:\/\/stateofthenation2012.com\/index.php?rest_route=\/wp\/v2\/posts\/127976","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/stateofthenation2012.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/stateofthenation2012.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/stateofthenation2012.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/stateofthenation2012.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=127976"}],"version-history":[{"count":0,"href":"https:\/\/stateofthenation2012.com\/index.php?rest_route=\/wp\/v2\/posts\/127976\/revisions"}],"wp:attachment":[{"href":"https:\/\/stateofthenation2012.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=127976"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/stateofthenation2012.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=127976"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/stateofthenation2012.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=127976"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}](\"https:\/\/khn.org\/wp-content\/uploads\/sites\/2\/2019\/08\/UVA15.jpg\"){kind=link}