NY Hospitals Place Liens Against Patient Homes Over Medical Debt

The report led by CSS underscores how hospitals throughout New York are securing liens against patient homes following a court-ordered medical debt judgment. These predatory medical debt tactics contribute to housing insecurity, endangering patient health and risking the economic health of patients.

The study showed that 56 non-profit hospitals sued over 4,880 patient homes between 2017 and 2018 in the collection of medical debt.

Research suggests that medical debt is strongly associated with housing insecurity, resulting in poor health outcomes.

The greatest number of liens placed were rural and poor counties. For example, 80 percent of liens that occurred were in counties with median incomes 300 percent below the poverty line for a family of four.

“We know that many moderate-income patients are unaware of hospital financial assistance and forego seeking medical care out of fear of being unable to afford it and falling into debt,”

Elisabeth Benjamin, VP of Health Initiatives at the Community Service Society and co-author of the report, said in a press release.

“Liens de-stabilize families and threaten their long-term economic security. Nonprofit hospitals should be prohibited from taking liens on patients’ homes and instead should help patients with complex medical and insurance billing disputes and applications for financial assistance were there outstanding balances,” Benjamin continued.

The report found that the median outstanding debt that prompted the lawsuits was $1,900. The study found the 4,880 patient homes are in jeopardy for a total amount of $9.3 million. 

The same hospitals were also responsible for collecting more than $442 million in state funds to assist the facilities in providing hospital financial assistance to patients and balance the cost linked to uncompensated care. 

These hospitals received an estimated 48 times more Indigent Care Pool (ICP) funds than they sought through court judgments followed by liens on patients’ homes.

“Our state invests billions of dollars into nonprofit hospitals to offset the costs of treating those who are unable to pay,” said State Senator Neil Breslin (Senate District 44) in the CSS report. 

“Still, the data shows that these hospitals are putting thousands of patients’ homes in jeopardy by filing liens, in some cases for medical bills that amount to only a few thousand dollars. These kinds of predatory debt collection practices must end.”

An estimated total of 70 percent of hospitals in New York did not place liens on patient homes.

According to the report, St. Peter’s Health Partners placed the most liens, with 955 liens, followed by Northwell Health with 830 liens placed on their patients. 

St. Peter’s Health Partners and Northwell Health accounts for almost 40 percent of the liens placed in 2018 and 2017.

CSS’s data showed that these hospital practices were widespread in 15 counties, including Albany, Rensselaer, Broome, Fulton, Madison, Nassau, Schenectady, Otsego, Ulster, Schuyler, Saratoga, Onondaga, and Steuben

A bill introduced by state Senator Gustavo Rivera and Assembly Member Richard Gottfrie would forbid hospitals from practicing extremely predatory collecting tactics of liens on patients’ homes in medical debt collection cases.