Your Money or Your Life by Luke Messac

Author:Luke Messac
Language: eng
Format: epub
Publisher: Oxford University Press
Published: 2023-11-15T00:00:00+00:00

Even if lawmakers sought to do nothing other than protect the uninsured from large hospital bills, they could not stop at shaming hospitals but would also have to change state laws that gave them (as well as third-party financiers of medical debt, such as credit card companies) rights to collect on these debts using aggressive measures.

The prevalence of the problem of aggressive debt collection and the extremes to which it is taken demonstrate the true nature of the American way of health financing, how patients are ultimately made to bear unbearable costs. They show how, in a landscape full of billboards and commercials professing care and compassion, even nonprofit health care providers can be ruthless in exacting repayment. This has led to some dour views on the purportedly charitable missions of these institutions. When University of Illinois law professor John Colombo testified before Congress in 2005 about the need for additional accountability to ensure hospitals justified their tax exemptions, he opined that “hospitals long ago quit being almshouses for the poor. Today, they are multimillion- or multibillion-dollar businesses.”78 It is difficult to argue that their actions do not support this opinion.

But if nonprofit hospitals failed to live by widely held ideals about their charitable missions, avowedly for-profit actors pursued debts without this historical baggage. A blitz of private equity buyouts of physician groups and hospitals in the mid-2010s brought a reinvigorated aggression to debt collection. Typically, a private equity firm uses debt to finance a leveraged buyout, then saddles the company it purchased with that debt. Over the next few years, it cuts costs and drives up revenues in anticipation of a quick resale.79 When private equity firms buy hospitals or physician groups, their determination to rapidly raise revenues can lead to unforgiving attitudes toward patients in debt.

One of the best-documented cases occurred in 2017 when Blackstone, the world’s largest private equity firm, purchased TeamHealth, an emergency physician staffing firm with more than 16,000 doctors, for $6.1 billion. After this buyout, one of TeamHealth’s subsidiary firms, Southeastern Emergency Physicians, began suing patients at a vastly accelerated pace. Investigative journalists at ProPublica and MLK50 found that during the 2 years following the buyout, Southeastern filed more than 4,800 lawsuits in Shelby County, Tennessee, where Memphis is located. The number of lawsuits filed by Southeastern against patients in Shelby doubled in the year after Blackstone’s buyout. In response to ProPublica’s coverage, TeamHealth eventually announced that it would stop suing patients and touted a new FAP for the uninsured.80 The journalist’s pen had, once more, stayed the hand of an aggressive creditor.

Private equity was at it again 2 years later when Congress was on the verge of passing legislation to end surprise billing. In this practice, common in emergency departments, patients who received emergency care received large medical bills from doctors who were not part of their insurance networks. When they could not reach agreement with an insurer, private equity groups and other investor-owned practices issued bills for the amounts that insurance would not pay.

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