CHS to erase up to $50M in medical debt for former hospital patients

As part of a legal settlement, Franklin, Tenn.-based Community Health Systems has agreed to forgive up to $50 million in medical debt for former patients at Deaconess and Valley hospitals in Washington state, according to The Spokesman-Review.

The agreement applies to the debt of former patients at Spokane, Wash.-based Deaconess and Spokane Valley, Wash.-based Valley hospitals who received treatment from Nov. 1, 2008, to June 30, 2017, the newspaper reported. CHS, at the time, owned the facilities, which are now owned by Tacoma, Wash.-based nonprofit MultiCare Health System.

The settlement resolves allegations from a lawsuit filed in June 2017 by Empire Health Foundation, a nonprofit formed with the 2008 sale of Spokane, Wash.-based Empire Health to CHS. The lawsuit claimed CHS, a for-profit hospital operator, did not provide at least $55 million in charity care that it promised when it acquired the two Washington facilities. Empire Health Foundation also alleged CHS was guilty of breach of contract and breach of implied duty of good faith and fair dealing.

As part of the settlement, CHS will pay $22 million — $2 million for the foundation's legal expenses and $20 million that the foundation will use to create a political lobbying arm, according to The Spokesman-Review.

The debt relief will affect thousands of former patients. CHS told the newspaper a specific number has not been determined, but the for-profit hospital operator expects the settlement to affect 5,000 to 15,000 people.

CHS disputes the allegations by Empire Health Foundation and did not admit wrongdoing in the settlement.

Read the full newspaper report here


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