This Hospital Has Sued Almost Everyone in an Oklahoma Town

Going to a hospital these days sends a chill down most people’s spines. The fear of the hospital bill is unavoidable because most people cannot pay the bill in full right away. At least, that is what McAlester Regional Medical Center has been banking on.

Deborah Hackler, a lawyer who sues patients on behalf of the medical center, recently sent out 51 debt collection lawsuits to the residents of a small farm community in Oklahoma. For nearly three decades, these lawsuits have generated a hefty payday for Hackler and the hospital, according to KFF Health News.

Since the early 1990s, the shadow of medical debt has loomed large over McAlester, Oklahoma, a small farming community of 18,000 residents. Records reveal a staggering number–nearly 5,000 debt collection cases filed by McAlester Regional Medical Center and an affiliated clinic.

“We have a health system that is putting immense financial pressure on patients. Whether it’s surprise medical bills or this rise in hospitals suing over unpaid medical bills, these kinds of financial risks make patients wary of going to the hospital for care they need,” says Zack Cooper, an associate professor of health policy at the Yale School of Public Health and of economics in the Faculty of Arts and Sciences.

When the hospital has unsettled bills, the providers will usually hire a third-party collections agency when internal collections fails to receive payments. If the third-party can’t get the payment, then they will file a small-claims lawsuit.

“There’s a lot that’s not right,” Sherry McKee, a dorm monitor at a tribal boarding school just outside McAlester, said at KFF Health News. McKee has been sued three times, including recently for a $3,375 bill for her vertigo.

Healthcare debt has a significant impact on more than 100 million Americans, affecting their finances, health, and well-being in several ways, adding to the $34 trillion of debt Americans have. Medical collection cases clog courtrooms.

In McAlester, the lawsuits create business for some individuals. The Adjustment Bureau, a local collection agency that is located in a concrete building down the street from the town’s courthouse, and Hackler benefit from the small-claims lawsuits.

According to KFF Health News, McKee wasn’t sure how she was going to pay off her recent judgment. The amount exceeds her monthly salary. One in five residents in McAlester live to the federal poverty line.

“I was disappointed to learn that nonprofit and critical access hospitals, which receive significant government support in part to help them provide care to low-income and rural communities, have been the most aggressive in suing their patients,” Neale Mahoney, an economics professor at Stanford University, says to Yale News.

The hospital has its own issues that it is facing. Operated by the city’s authority, the hospital is fading into time and in desperate need of repairs. According to the state auditor’s website, the hospital has been operating in the red for years.

The hospital operates as a clinic for low-income patients and says that it has “limited appointments” at no cost for approved patients, according to its website. However, KFF Health News discovered that audits reveal that the hospital offers very little financial assistance.

The McAlester hospital isn’t the only one suing patients. According to NPR, approximately 5,100 hospitals that sever the general public that have polices to use legal action or other aggressive tactics against patients.

“We don’t want to promote the concept that medical bills just go away, especially for those who are able to pay,” said Michael Beyer, who oversees patient accounts at the nonprofit Sanford Health, tells NPR.

Finding aid can be an impossible task for most patients in the U.S. Often, the complicated process requires patients to produce exhaustive amounts of personal financial information, and the standards vary to each provider.

“The system doesn’t work,” said Jared Walker, founder of Dollar For, a nonprofit that has helped thousands of people across the country apply for financial aid.

Frightened by the unfamiliar legal labyrinth and the prospect of courtroom appearances, hospital lawsuit victims often surrender their rights, never daring to contest the charges.

In recent years, some states have stopped their health systems from suing patients after news that this was happening came to light. Several states, like Maryland and New York, have taken major steps to restrict the legal actions hospitals can take against patients.

This type of collection practice is unfortunately common among all types of hospitals across the U.S. NPR reports that industry officials say they are careful about who they target for unpaid bills, most patients with unpaid bills are likely to get sued.

According to Consumer Finance Protection Bureau, these are your rights and protections when it comes to medical bill and collections in the U.S.

You are also protected under the No Surprises Act. In 2022, the act means you should not receive unexpected bills for emergency services received from a health care providers or facility that you didn’t know was out-of-network until you were billed.

Luckily, the No Surprise Act is looking out for patients. If the bill amount is $400 or more than the estimate provided by the provider, you can dispute the charges.

There are a few hospitals that have rejected taking steps toward aggressive collections: The medical centers at UCLA, Standford University, the University of Vermont Medical Center, and Ochsner Health.