In all, Methodist Le Bonheur Healthcare filed over 8,300 debt lawsuits between 2014 and 2018.
Methodist, located in Memphis, Tennessee, brings in $2.1 billion in revenue and owns six hospitals, along with over 150 outpatient centers, clinics and physician practices.
One Methodist hospital housekeeper had to leave her job during her shift to go to the Shelby County General Sessions Court because the hospital was suing her for unpaid medical bills. She now owes more than $23,000, including around $5,800 in attorney's fees. Methodist pays her $12.25 an hour, according to ProPublica.
"You know how much you pay me. And the money you’re paying, I can’t live on," said the housekeeper.
Nearly 1 in 4 people in Memphis are under the poverty line.
She called Consolidated Recovery Systems, a subsidiary of Revenue Assurance Professionals, a licensed debt collection agency owned by Methodist, and offered to pay $50 every two weeks. "But they said it wasn't enough," she said. "I would just have to go to court. They said I’d be owing them all my life."
The housekeeper earned $16,000 in 2017, more than $4,000 below that year's federal poverty level for a family of three like her family. Since she had insurance, though, she was ineligible for assistance under the hospital's policy.
Methodist's lowest payed employees make $10 an hour and about 18% of their workers make less than $15 an hour. The average living wage for one adult and two children is about $25, according to MIT's Living Wage Calculator.
She offered to pay $50 biweekly or $100 in most months in court. The hospital demanded $200. She offered $75 biweekly since she was nervous that the judge would side with the hospital and the judge and attorney agreed on that amount, ProPublica reported.
Asked how she manages to make ends meet, the housekeeper replied that she doesn't. "It's killing me, killing me softly," she said.
She didn't reach out to a manager or Methodist's payroll department. "They don’t care about that. … That I do know," she said.
While Methodist's amount of lawsuits filed isn't unusual considering the size of the company, it does seek an inordinate amount of wage garnishment orders.
A court-ordered garnishment requires that the debtor's employer take 25% of a worker's after-tax income and send it to the court, minus basic living expenses and a small deduction for children under the age of 15. That payment is then forwarded to the creditor.
In 46% of the cases filed by Methodist between 2014 and 2018, they secured a garnishment order. From 2014 through 2018, Methodist tried to garnish the wages of over 160 of their employees. In over 70 cases, they succeeded.
In one case, an employee appeared in the courtroom in hospital scrubs after being sued for more than $4,000. After leaving the courtroom, she said that she was annoyed that they hadn't contact her before suing her. "I don’t know why they can’t come upstairs," she said.
In another case in May, an employee who has worked for Methodist for over four years entered the courtroom with over $5,400 in debt, including a hospital charge from the newborn unit. Her affidavit listed a checking account balance of less than $4. She offered to pay $10 biweekly or $20 most months. The Methodist attorney demanded $200 a month and the judge ordered her to pay $100 a month.
"One would hope that if this is an action being taken against a significant amount of employees, the hospital would look at the insurance they provide workers," said Mark Rukavina, an expert in nonprofit hospitals and a manager at Community Catalyst, a health care advocacy organization.
Methodist's financial assistance policy offers no assistance for patients with any form of health insurance, no matter the out-of-pocket costs. Under Methodist's insurance plan, employees have to pay a $750 individual deductible and 20% of inpatient and outpatient costs, which can add up to an anout-of-pocket cost of $4,100 a year.
In one case of wage garnishment, the hospital attempted to garnish the wages of Carrie Barrett, a former patient, and was denied a few times since Barrett didn't earn enough to have her pay garnished. Four times her employer returned the garnishment order to the court marked "Net Earnings Less Than Exemptions."
Although the hospital knew that Barrett was a low-income worker, they added interest to her account seven times, in amounts ranging from $46 to $7,340. Every 30 days, she pays $60 to renew the $300 loan with an effective annual interest rate of over 240%.
If Methodist doesn’t add any interest to Barrett’s debt and she pays as ordered, she will pay it off in 330 months.
Barrett will be 90 years old, by then.
Methodist offers 0% interest payment plans to insured and uninsured patients who can't pay their bills, but only before court action commences. The hospital also provides an automatic 70% discount to uninsured patients and free care to patients at or below 125% of the federal poverty guidelines which would be about $15,600 for a single adult.
"We are committed to working with all patients who are struggling with medical expenses. Our desire is to work with patients early in the process to set up a payment plan that meets their individual need," said the hospital in a statement.
According to ProPublica, these claims are not backed up by the text of its financial assistance, billing and collections policies or the frequently asked billing questions on the hospital's website. Interest-free payment plans are never mentioned.
ProPublica also found that Methodist does not have their financial assistance policies posted in visible places at their facilities. According to IRS policies, nonprofit hospitals must publicize policies in areas accessible to the public, including the emergency room.
When someone walks into a hospital, "you want to be able to see it,” said Marcus Owens, an attorney who formerly ran the IRS’ tax exempt organization division. “Having it on the underside of a desk wouldn’t be sufficient.”
Reporters who visited Methodist's five emergency rooms located in Shelby County, Tennessee found no signs on the wall or displays referring to financial assistance.
One patient, Raquel Nelson, owes $2,200 to Methodist. When money is tight, she pays just enough on her utility bill to keep the lights on. When she received a warrant stating that she'd been sued by Methodist, she was also given the contact details for Consolidated Recovery Systems.
When she called them, she was told to meet them in court if she couldn't pay $175 a month. So she went to court and filed a motion to pay $75 a month, the amount she had offered to pay the collection agency. In court, the attorneys for Methodist agreed to that amount. The court case cost Nelson time off work, parking fees for three trips to court and $27 filing fee, all for the attorneys to just agree with the amount she had offered to the collection agency. "They were just being greedy," Nelson said.
One FedEx worker and mother of two was summoned to court by the hospital even though she had made her $50 per month payments on time. A sworn affidavit showed that her monthly expenses were $170 more than her income, according to ProPublica.
“She is paying on time,” said Dewun Settle, an attorney for Methodist. “We’re seeking an increase for $100 a month so the balance won’t continue to increase.” The hospital had added over $400 since September, raising her debt to nearly $7,000.
The judge asked the defendant if she could pay the $75.
“My house is in foreclosure right now,” she replied. The judge continued to press her, but eventually relented and allowed her to continue with the $50 a month payments. She filed for bankruptcy shortly after.
In the first three months of 2019, the state of Tennessee provided $5 million in assistance to Methodist Le Bonheur Healthcare's hospitals. In 2018, the hospital brought in $86 million more than it spent and its president and CEO, Dr. Michael Ugwueke, received $1.6 million in total compensation.