UCHealth sued patients nearly 16K times in last 5 years, investigation reveals

Over the last five years, Aurora, Colo.-based UCHealth has sued its patients 15,710 times for money that they owe to the health system, The Colorado Sun reported Feb. 19.

The findings come from an investigation conducted by 9News and The Colorado Sun in partnership with KFF Health News and the Colorado News Collaborative. 

The investigation also revealed that many of the lawsuits have been kept from public scrutiny due to UCHealth working with collection companies that file the lawsuits under their names, not the nonprofit health system's name.

"They are essentially deliberately using those third-party collection agencies to obscure the fact that they are the ones suing the patients," Adam Fox, deputy director of the Colorado Consumer Health Initiative, a consumer advocacy group that helps patients in disputes over medical bills, told The Colorado Sun. "It makes it really hard for the patient to untangle."

In five years, the health system has filed an average of 3,142 lawsuits annually, or more than eight daily.

"UCHealth's billing practices are in line with the policies of most health care providers across the nation," a spokesperson for UCHealth said in a statement shared with Becker's. "We offer extensive financial assistance resources, and we reach out to patients numerous times offering to screen them for assistance. Sending an account to collections is always a last resort."

UCHealth is a $6 billion organization with more than 30,000 employees that comprises a network of hospitals, clinics and practices throughout Colorado. It cares for around 3 million patients a year.

"More than 99.9% of our patients either pay their bills or receive financial assistance with no involvement of a court," the spokesperson said. "We depend on reimbursements to provide health care to our patients and support our employees."

The investigation found that the health system "assigns" one of its two debt collectors the debt without claiming the debt ownership. The debt collector will then file the lawsuits against the patients in its name, which can be nondescript.

Through whatever money comes from the lawsuit, the debt collector gets a cut and the rest is returned to UCHealth. UCHealth collects around $5 million yearly from lawsuits, representing 0.07% of its received net patient revenue from 2023, the health system told The Colorado Sun

The health system is seeing a rise in uncompensated care, along with lower Medicare and Medicaid payment rates. It provided $580 million in uncompensated care in fiscal year 2023, which is a more than $200 million increase from 2019, the publication reported.

"I can tell you it is a common practice," Cooper Melmed, chief legal officer for UCHealth, told the publication on the lawsuits. "I don't think UCHealth is an outlier here. We're not an outlier in the number, and we're not an outlier in the way to go about this."

In 2022, KFF Health News found around two-thirds of hospital policies across the U.S. allow them to either sue or take other legal action against patients, including garnishing wages. However, some health systems, including several in Colorado, do not sue patients, according to the report. New York recently proposed a policy to prevent state-owned hospitals from suing their patients who meet certain income requirements over medical debt.

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