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STOP Collector Blog From the law firm of Lemberg & Associates

New York Hospitals Wrongly Unleash Debt Collectors

The New York Times reports that hospitals in the state are unleashing debt collectors on patients and filing lawsuits against them while collecting money for the patients’ care from the state’s Indigent Care Pool. The money, collected by tacking on an 8.95 percent charge to hospital bills, is provided on behalf of patients who complete financial aid applications and qualify for coverage. The Times reports that a soon-to-be-released study finds that hospitals often don’t provide patients with financial aid applications or demand documentation beyond the law’s requirements. The law says that, prior to suing patients, hospitals need to provide a financial aid application. The Times notes, “Instead, many hospitals turn to collection agencies, and sue when that fails. The unpaid bills – typically reflecting much higher rtes than what insurers pay – are then treated as the equivalent of charity care.”

The article notes that other states, including California, Illinois, and Minnesota, have similar laws.

Medical bills are a primary driver of bankruptcy. Consumers who have judgments against them for medical bills can have difficulty obtaining a loan, getting a job, or finding housing. Hospitals have a legal obligation to assist patients with available financial aid, and a moral obligation to stop ruining lives of those they’re tasked with trying to save.


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Sergei Lemberg

Sergei Lemberg is the principal at Lemberg & Associates, a consumer law firm that defends consumer rights in the areas of fair debt collection law, fair credit law, and lemon law, among others. He is regularly labeled by the debt collection industry as one of the “most active consumer attorneys” in the U.S.

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