A lot of people who North Carolina’s biggest hospital system sued for not paying their medical bills are going to get help.
Atrium Health says it will forgive people’s medical bills and take away the liens it has on their homes. This will help a lot of people in North Carolina.
Advocate Health, which is the parent company of Atrium, just told The Charlotte Observer Thursday that it will cancel liens on more than 11,500 homes in North Carolina and five other states. This is part of that move. Some of those liens are from more than 20 years ago.
This hospital, along with more than thirty others, is owned by Atrium, a Charlotte-based nonprofit health system. For years, it sued thousands of patients to get their money back and put liens on many of their houses.
In late 2022, Atrium stopped suing patients without making a fuss. But the liens stayed in place after that, so the hospital could get what it thought it was owed when those patients died or sold their homes.
Advocate said in an email that the hospital system will now start to give those rights back. Getting rid of the liens will require formal work, and it could take a few months to get rid of all of them. Advocate officials said that the hospital system will first get rid of the oldest liens.
Advocate Health said the move is “part of a multi-year plan to change how the system handles medical debt.” Before, the system stopped sending late medical bills to credit agencies, lowered the amount of money that patients had to make to get free care, and automatically made more people eligible for financial aid.
According to Brad Clark, chief financial officer of Advocate Health, when they expanded their charity care policy, they looked at all of their old open liens right away and found that most of the patients would be eligible under the new policy.
“This is the next step in our plan to make care more affordable. To speed up the process, we are removing judgement liens that were put on homes and property to cover unpaid medical bills.”
Phone call brings relief
Terry Belk will be glad to hear that.
Sandra, his late wife, was identified with breast cancer many years ago, and the two of them had health insurance. But they still owed $23,000 in hospital bills and couldn’t pay them.
They agreed to sign a deed of trust for their east Charlotte home in 2005 because a hospital lawyer told them to. That meant the Belks had to pay off Atrium Health’s debt and the lawyer’s fees before they could sell their house.
After about five years, Belk was told he had prostate cancer and had to pay more hospital bills. Atrium went to court to get about $7,000 back and put a lien on the three-bedroom house.
Belk said that the hospital bill kept following his wife until she died in 2012. Belk said that she didn’t want to go back to the hospital when her cancer came back because she was so worried. Belk started hiding Atrium’s bills from her to make her feel better.
Belk says that the medical bills have hurt his credit and made him put off retiring. He still works as a car seller at age 68.
On Tuesday, a phone call made him feel better. He said that an Atrium vice president called to tell him that the hospital system would be releasing the debts it has against his house.
Belk said, “I was thrilled.” “I’m not a wealthy person.” This makes things hard for someone.
Belk has been critical of Atrium for years for how it collects debts, but this week he had more good things to say about the hospital system.
He said, “I think it’s great.” The sick people will feel a lot less stressed because of it. That’s the last thing sick people need to worry about.
Move follows years of scrutiny
The decision to cancel the liens came after years of harsh criticism from patient advocates and civil rights groups who said the system’s debt-collection methods were too harsh.
An investigation by The Charlotte Observer and the News and Observer in 2012 found that nonprofit hospitals in North Carolina often went against their charitable goals.
Even though they got billions of dollars in tax breaks, many of them gave little back to the community in the form of free care and other services. Some, like Atrium, sued thousands of patients who didn’t pay their bills.
In the past few years, State Treasurer Dale Folwell has put out a number of reports that come to the same results. Folwell is a vocal opponent of nonprofit hospitals.
A report from last year by Folwell’s office and Duke Law School professors says that from 2017 to 2022, Atrium sued almost 2,500 users. The system got nearly $23,000 in court judgements against patients on average. More than 3,400 more lawsuits were made by hospitals in the state.
This is what Folwell said in a statement yesterday:
“I’m glad Atrium is finally doing the right thing by getting rid of people’s medical debt and the harsh liens they put on their homes.” It’s too bad that it comes after a lot of lives have been destroyed and a lot of people have been stuck in poverty for generations.
Atrium made more than $230 million in profit last year, according to its most recent yearly financial statement. It made more than $5 billion in sales.
Advocate Health owns hospitals in the Carolinas, Georgia, Alabama, Illinois, and Wisconsin. It is the third biggest nonprofit health system in the country. More than 5 million people now use it. Last year, the system made a profit of $2.2 billion on sales of more than $31 billion.
A new plan led by state health officials will wipe out hospital debt for up to two million North Carolinians. This comes after Advocate’s move to lift liens.