New York State-Run Hospital Suing Patients Over Medical Debt

By Consumers for Quality Care, on January 10, 2024

An investigative report conducted by Syracuse.com and The Post-Standard finds that state-run hospitals in New York are engaging in aggressive and harsh medical debt collection practices.

Harry Martin, 54, was receiving treatment from Upstate Medical University hospital for his pancreatic cancer. With just months to live, Upstate Medical sued Martin for $10,700 in unpaid medical bills. “The amount of stress this caused both of us is beyond words,” said his fiancée, Linda Koberna. “We couldn’t understand why they would want to sue someone who’s terminally ill.” Martin passed away in September 2023.

Roughly 1 in 4 Syracuse adults have medical debt in collections. An analysis of records from Syracuse-area hospitals determined state-run Upstate Medical and Community General hospitals sued more than 4,000 consumers since the COVID-19 pandemic, more than any other hospitals in the area. Furthermore, this investigation revealed publicly funded hospitals in New York have far more aggressive debt-collection policies and procedures than private hospitals.

Each week, Upstate Medical refers an average of 30 overdue bills to the state’s Attorney General’s Office, using a 30-year-old directive enacted by then-New York Governor George Pataki that directs public hospitals to refer medical debt in collection to the Attorney General. This was updated in 2017 to allow hospitals to refer only those debts that exceed $2,500. Still, many advocates believe that this guidance is not enough to protect consumers.

Just one medical emergency can have negative consequences that make it difficult for consumers to recover financially. Medical debt hurts consumers’ ability to get a job, rent an apartment, or buy a home. For these reasons, New York and other states have taken steps alleviate the harms of medical debt. New York Governor Kathy Hochul signed legislation last month to prohibit medical debt from being included on consumer credit reports. Last September, New York Assemblymember Amy Paulin, Chair of the Committee on Health, sponsored a bill that would prohibit public hospitals from suing consumers over medical debt. But more needs to be done.

CQC calls on lawmakers and providers to help patients avoid crushing burden of medical debt and urges hospitals to better serve their communities by spending more on charity care for those in need.