Providence Settlement Reveals Deep-Seated Issues in Nonprofit Hospitals 

By Consumers for Quality Care, on February 21, 2024

​​A recent settlement between Providence, a sprawling 14-hospital health system, and the Washington Attorney General is shining a light on the dubious practices of nonprofit hospitals, according to Healthcare Dive.  

​In what is being hailed as the “largest resolution of its kind in the country,” the agreement exposes Providence’s blatant disregard for the well-being of nearly 100,000 low-income Washington residents. The proposed remedy includes $20 million in refunds for over 30,000 consumers billed erroneously and a forgiveness of $137 million in outstanding medical debt for more than 65,000 patients. ​ 

​​The investigation​,​ spearheaded by Washington Attorney General Bob Ferguson, revealed​ troubling practices by Providence​. Between 2018 and 2023, the Providence health system trained staff to aggressively pursue payments from financially strapped patients. ​​Employees were also instructed not to accept refusals from patients struggling to pay. According to the settlement, one of Providence’s employees told leadership that the health system’s practices were “sending the poor to bad debt.”​ 

Washington’s charity care law, though ostensibly protective, has proven insufficient against the profit-driven juggernauts of nonprofit hospitals. Recent legislative changes in July 2022 have broadened coverage for working-class families, but medical debt continues be an issue for many. 

CQC urges nonprofit hospitals to hold up their end of the bargain to better serve their communities and deliver care for patients when they need it most. Furthermore, CQC urges lawmakers and regulators to put an end to hospitals utilizing predatory medical debt collection tactics that harm consumers and exacerbate the medical debt crisis.