Methodist Hospital suspends debt collection lawsuits after report

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MEMPHIS, Tenn. — Memphis’ largest hospital system, Methodist Le Bonheur Healthcare, has temporarily suspended legal action over unpaid medical bills after it was discovered some of the hospital’s own lower wage-earning employees were falling into mountains of debt.

The 30-day suspension to evaluate billing practices comes after more than a year of investigating and research showing Methodist had filed 8,300 lawsuits in the past five years.

“You can only earn so much money and you can only pay so much. It’s a real problem with the healthcare industry as a whole,” said Kevin Snider, an attorney who deals with consumer protection.

Methodist, a nonprofit, Christian healthcare system, started receiving blowback last week after nonprofit news organizations Pro Publica, in partnership with MLK:50 Justice Through Journalism, released the staggering statistics and shocking findings.

 “We interviewed several people who work for the hospital, who make less than $13 an hour, who are being sued for hospital bills they can’t afford to pay,” said Wendi Thomas, editor and publisher of MLK50: Justice Through Journalism, “and in some cases these patients had worked for Methodist and had Methodist insurance, and were still left with bills they couldn’t afford to pay.”

She says the fact Methodist sues isn’t unusual, and pointed out the number of lawsuits isn’t unusual for the hospital’s size compared to other area competitors.  What is unusual is their aggressiveness.

Following the series of stories, Methodist issued a statement saying it is halting court collections for now.

The statement from a hospital spokesperson said: We are dedicated to strengthening the communities we serve and improving the well-being of patients and families. We recognize that we serve a diverse community and we are always thinking about how we can do more and serve our community better. Over the next 30 days we will be reviewing our policies and procedures to ensure we are doing everything possible to provide the communities we serve with the care and assistance they need. Also, we will immediately suspend any further court collection activities during this period. As a learning organization that is committed to continuous quality improvement, we want to be absolutely sure that our practices continue to support our mission and vision of improving every life we touch regardless of ability to pay. 

Thomas said when she got word of the suspension, she rushed to courthouse this morning to see what would happen, and about 27 cases were dropped from the docket.

“So I’ve sat in court and listened to Methodist try cases now for almost six months,” Thomas said. “It was unusual to hear the attorney for the plaintiff, Methodist, say, ‘Dropped, please your honor, dropped, dropped, dropped.’

But review doesn’t necessarily mean change, Thomas explained.

“I think they can look at everything, but unless they decide they’re going to make their financial assistance policy more generous, that they’re going to stop taking these extraordinary collection actions, that they’re going to forgive some of the debts for these people that can’t afford to pay them, to me that’s what other hospitals we found in our research have done when they were subject of investigations like this. So Methodist has a path to follow if it so chooses.”

WREG asked Methodist for an on camera interview but they only provided a statement.

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