Hospitals Disproportionately Sue Low-Income, Rural, and Black Patients
Some patients are discharged from the hospital with a good medical outcome, only to face a lawsuit or garnished wages for unpaid medical bills.1,2 “There have been a growing number of stories in the popular press. We wanted to get a more rigorous sense of the incidence of hospitals suing patients,” says Zack Cooper, PhD, director of health policy at the Yale University Institution for Social and Policy Studies.
Cooper and colleagues analyzed Wisconsin court records from 2001 to 2018. They found hospital lawsuits increased by 37% during this period.3 “The sheer scale of the litigation was surprising. That one in 1,000 [Wisconsin] residents is getting sued annually surprised us,” Cooper reports.
The lawsuits could make patients wary of going to the hospital for needed care. This, on top of the fact medical costs continue rising, putting care even further out of the reach of low-income patients and people of color, notes Emily Radel, associate director of health policy at Yale’s Tobin Center for Economic Policy.
Black patients and those living in poorer and rural counties were sued more often. During the study period, wage garnishments from the lawsuits increased by 27%; by 2018, more than half of the lawsuits resulted in wage garnishments. “Unaffordable, out-of-pocket medical costs are a systemic issue that generally falls onto the most vulnerable in our population,” Radel says.
Hospitals continuing to pursue collections lawsuits “highlights a fault in our system that we need to think about. Who do we want to be bearing these sorts of burdens? Is that what we intended when we started subsidizing these facilities?” Radel asks.
Christopher Robertson, JD, PhD, professor of law at Boston University, says, “this is the legal system that Congress and state legislatures have created. From one perspective, hospitals are like any other creditor, and thus can be expected to exercise their legal rights, whatever they are.”
EMTALA requires the hospital to provide stabilizing emergency care regardless of ability to pay, but the law does not proscribe attempts to recover costs.
“However, from an ethical perspective, one may conceive healthcare as a special calling and an essential service. In that sense, a hospital should hold itself to a higher standard than a plumber or used car salesperson,” Robertson says.
Suing patients for unpaid bills often is contrary to federal and state laws, which require first assessing whether the patient qualified for charity care or cheaper fees. Moreover, lawsuits often are futile, causing harm with little benefit. “If your only recourse is to garnish their meager wages or foreclose on their home, you could be harming their well-being and health,” Robertson says.
The dollar amount of the hospital bills also is ethically questionable. “Hospital bills often lack any basis for their amounts,” Robertson says. “It is unethical to demand more than a fair and reasonable price.”
Ethicists could raise the issue with hospital administrators. “Ethicists should provide a moral compass for hospitals, and, I think, should be asking whether engaging in this type of litigation is consistent with the obligation of providers to ‘Do no harm,’” Cooper suggests.
The ethicist’s role is “how we define it,” says Robertson. “You need not have such a cramped conception that it is limited to informed consent and end-of-life issues. You can instead be a force for change in your institution.”
- Kusterbeck S. Hospitals suing patients for unpaid bills. Hospital Access Management. Aug. 1, 2019.
- Kusterbeck S. Overly aggressive collection risks violating several ethical principles. Medical Ethics Advisor. Oct. 1, 2019.
- Cooper Z, Han J, Mahoney N. Hospital lawsuits over unpaid bills increased by 37 percent in Wisconsin from 2001 to 2018. Health Aff (Millwood) 2021;40:1830-1835.
One expert believes ethicists should serve as a "moral compass for hospitals," pushing facility leaders to consider whether engaging in litigation like this is the best course of action.
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