A grocery store clerk who made $9.05 an hour owed Memphis’ largest health care system more than $33,000. If she paid on her overdue hospital bill as ordered, she would be 90 years old by the time she’d satisfied her debt to Methodist Le Bonheur Healthcare. The same hospital sued one of its own employees, a housekeeper, for more than $23,000 in unpaid bills, or more than a year’s pay. And it garnished the paycheck of a hotel clerk who sometimes went hungry because she didn’t have the money for food. To try to collect on unpaid hospital bills, Methodist Le Bonheur Healthcare sued more than 8,300 people – many of them low-income – over a five-year period.
MLK50: Justice Through Journalism, working with ProPublica, documented how the nonprofit’s rapacious debt collection practices threw already financially precarious lives into disarray. In fact, the faith-based institution had become the most aggressive plaintiff suing people over unpaid debts in Shelby County, Tennessee. Hospitals across the country sue patients, but few do so in a city as impoverished as Memphis. It is the second poorest large city in the nation, where 1 in 4 residents live below the poverty line and more than 40% of workers earn less than $15 an hour. These lawsuits clogged the courts and made it hard, if not impossible, for poor people to make ends meet.
For months, reporter Wendi C. Thomas followed defendants as they faced the hospital’s own collection agency, encountering stern judges and a system that often pitted confused defendants against Methodist’s savvy legal team. Some of those defendants showed up to court wearing their Methodist uniforms. Asked how she manages to make ends meet, the hospital housekeeper said she doesn’t. “It’s killing me, killing me softly,” she said. The small monthly payments many defendants could afford were drowned by the mountains of court costs and interest Methodist added onto cases. Some defendants turned to payday loans; one skipped her son’s follow-up doctor’s appointments.
Not only was Methodist aggressive in court, its financial assistance policy for low-income patients was unusually stingy compared to other nonprofit hospitals across the state. Thomas gathered the policies of nonprofits throughout the state to reach that conclusion. Consumer advocates pointed out that suing patients is a choice – one that many nonprofit hospitals have decided not to make. A retired Methodist minister called it a “21st-century version of slavery.”
Outrage was swift. Memphians were horrified. The hospital’s own doctors took their ire to the hospital’s board, most of whom had refused requests for an interview. Less than five weeks post-publication, chastened hospital officials — who had refused all interview requests — announced sweeping changes that in the end, wiped away $11.9 million in debt for more than 5,300 patients. Methodist expanded its charity care policy to encompass more than 50% of area residents and raised the pay of its lowest-paid employees.
Methodist was not alone: A subsequent story focused on Southeastern Emergency Physicians, which staffed the emergency rooms at Baptist Memorial Health Care hospitals in the Memphis area. Since 2017, Southeastern had filed more than 4,800 lawsuits, at a growing pace that tracked the acquisition of its parent company by private equity giant Blackstone. Perhaps eager to avoid the public drubbing Methodist endured, TeamHealth chose a pre-emptive path: Following an interview and pointed questions from Thomas but before the story published, the company announced it would no longer sue patients.