By Michelle Crouch
Co-published with The Charlotte Ledger
Atrium Health announced Thursday, Sept. 19, that it is wiping out all existing judgments and liens against patients for unpaid medical bills, offering relief to hundreds of North Carolinians who have been sued by the hospital system.
The Charlotte Ledger/NC Health News reported in October 2023 that the nonprofit system had quietly stopped filing new lawsuits against patients but that the hospital was still pursuing collection on past debts.
At the time, patients and attorneys told The Ledger/NC Health News they were disappointed the change would not help those with existing liens on their homes.
Now, some of those patients are celebrating.
“It’s been a 20-year battle, like an albatross around my neck,” said Terry Belk, a Charlotte patient with medical debt who has been an outspoken critic of Atrium’s collection practices. “It has threatened to take everything I built up. It’s been stressful — financially, mentally and somewhat physically — having this hanging over me.”
Belk, 68, said he has more than $40,000 in medical debt and a lien on his home related to breast cancer treatment for his wife, Sandra, who died in 2012, and his own more recent treatment for prostate cancer.
He said he learned about the change after calling an Atrium vice president earlier this week.
“It’s a huge relief,” he said.
In North Carolina, medical debt judgments can last for 20 years and automatically place liens against patients’ homes, allowing hospitals to collect their money when the home is sold. Medical debts also accrue 8 percent interest per year as long as they remain unpaid.
Atrium’s announcement comes amid growing pressure on hospitals nationwide to reform their debt collection and billing practices as the number of Americans struggling with medical debt soars. About one in five North Carolina residents has medical debt in collections, according to an Urban Institute analysis.
11,500 liens wiped out
In a news release announcing the change, Advocate Health, Atrium’s parent organization, said it plans to cancel liens on more than 11,500 homes and properties within its six-state footprint. Some of the liens date back 20 years.
It described the change as part of its “multi-year initiative to overhaul the system’s approach to medical debt.”
In 2022, Atrium stopped reporting medical debt to credit agencies and expanded its charity care program to families earning up to 300 percent of the federal poverty level ($93,600 for a family of four), the release said.
“When we expanded our charity care policy, we immediately began assessing all previous outstanding liens and determined that most of those patients would qualify under our new policy,” said Brad Clark, chief financial officer of Advocate Health. “As the next step in our roadmap to make care more affordable, we are accelerating this process.”
The process of canceling liens will take time, the hospital said, directing patients to FAQs posted at advocatehealth.org/liens.
Treasurer: Lives have already been ruined
A study conducted by Duke University and the North Carolina Treasurer’s Office revealed that from January 2017 to June 2022, Atrium Health filed 2,482 lawsuits against patients, with an average judgment amount of $22,953.
State Treasurer Dale Folwell, a longtime critic of the state’s hospitals, said in a statement that he’s glad Atrium is “finally doing the right thing,” but that it should have happened sooner.
“Unfortunately, it comes after many lives have already been ruined and thousands were thrown into generational poverty,” he said.
A new North Carolina medical debt relief program bans North Carolina’s acute care hospitals from foreclosing on someone’s home to collect medical debt, but the program does not appear to prohibit suing a patient or placing a lien on their property over an unpaid bill.
The program, crafted by Gov. Roy Cooper and state health officials, incentivized hospitals to make specific changes to their financial assistance policies and to forgive medical debt for certain low-income patients by promising millions in extra federal dollars to those that participate.
Atrium, the state’s largest hospital system, had more than $452 million in operating profit and a record $9.2 billion in revenue in 2023.
Some patients miss out
Leah Kane, an attorney with the Charlotte Center for Legal Advocacy who has helped clients with medical debt, said Atrium’s announcement was “long overdue.”
“That’s great news,” she said. “These judgments … suck income and equity from working families, most of whom incurred this debt from emergencies. It probably should have been forgiven a long time ago.”
For some patients, however, Atrium’s change comes too late.
Marcie Lynn Stafford, 65, owed $7,824 from a surgery she had back in 2012, and Atrium won a case against her that year, court records show. With interest, the amount she owed grew to about $15,000, and Atrium placed a lien on her home for that amount when it renewed the case against her in December 2022.
Stafford said she sold her home in 2023, and the hospital took $15,000 from the sale.
When told about Atrium’s policy change, Stafford said, “It’s good for other patients. I’m happy for them. But it looks like I should have waited to sell.”
This article is part of a partnership between The Charlotte Ledger and North Carolina Health News to produce original health care reporting focused on the Charlotte area. Want more information? Read more here.
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