N.C. hospitals are signing on to medical debt relief plan
At least 37 hospitals in North Carolina have joined a state program to eliminate medical debt for low-income patients.
The following article appeared in the August 9, 2024, edition of The Charlotte Ledger, an e-newsletter with smart and original local news for Charlotte. We offer free and paid subscription plans. More info here.
Novant Health and other big health systems have joined Gov. Cooper’s initiative to slash medical debt for low-income patients. As the deadline looms, will Atrium follow suit?
By Michelle Crouch
Co-published with N.C. Health News
At least 37 of the state’s 99 hospitals — including all of those affiliated with Novant Health — have so far signed up for a new state program that promises extra federal money if they agree to wipe out old medical debt for low-income patients and take steps to help those patients avoid debt in the future, state health officials said.
With a deadline of 5 p.m. today, the big question is: Will Atrium Health, the state’s largest hospital system, get on board?
Atrium did not respond to Ledger/NC Health News requests for comment sent Tuesday and Thursday. Previously, Atrium and other hospitals have said that parts of their financial assistance policies already meet or exceed some of the state’s proposed requirements.
In addition to Novant, other major hospital systems that are participating are Cone Health, UNC Health and ECU Health, state officials said.
The medical debt program, believed to be the first of its kind nationwide, would provide higher federal payments to hospitals that agree to forgive medical debt deemed uncollectible dating back to 2014 for low- and middle-income patients.
Hospitals would also have to abide by other conditions, such as offering discounts ranging from 50% to 100% to low-income patients, capping interest rates on hospital-held medical debt at 3% and agreeing not to report medical debt to credit agencies.
Gov. Roy Cooper and N.C. Health and Human Services Secretary Kody Kinsley visited Charlotte on Wednesday to promote the program and presumably to increase public pressure on hospitals that are still on the fence.
“This makes sense for hospitals, their patients and their communities,” Cooper said during a visit to Care Ring, a Charlotte nonprofit that provides health services to the uninsured and underinsured. “Statistics show that hospitals only collect about 5% of their medical debt. … Under this program they will most likely — and their fiscal analysts are looking at this, you can bet your boots they are — they’ll earn more by forgiving medical debt than they would otherwise.”
For hospitals, the issue likely isn’t quite that straightforward. The program would require some hospitals to overhaul their financial assistance policies and offer free care to more patients.
Also, while bigger healthcare systems stand to get millions in extra dollars for participating, smaller systems and rural hospitals would receive proportionally smaller payments.
A spokeswoman for the North Carolina Healthcare Association, which represents hospitals, said the group was waiting to comment until after the Friday deadline.
1 in 5 in collections: The medical debt program aims to tackle a growing medical debt problem in North Carolina, where one in five residents has medical debt in collections. Cooper said about two million North Carolinians owe about $4 billion in medical debt, and “much of that is hospital debt.”
Addressing medical debt is a bipartisan issue, with Republican state Treasurer Dale Folwell railing at hospitals during a monthly phone call with reporters.
“These … multi-billion dollar corporations who disguise themselves as nonprofits have made these billions of dollars on the backs of sick people,” he said. “Then they send people medical bills.”
But Folwell didn’t agree with Cooper’s approach.
“[Hospitals] will not match the level of charity care with billions of dollars of tax benefit they’re getting, and now they expect the government to bail them out,” he said.
A few advocacy groups, including executive directors of Black-led nonprofits, faith leaders and medical students at Duke and UNC, have launched letter-writing campaigns to hospital CEOs encouraging them to participate.
Although Novant has opted in to the program, no one from the system appeared to be present at Wednesday’s event. When asked about the decision, a Novant spokeswoman sent a statement that said:
Novant Health’s industry-leading financial assistance policies are an example of our longstanding efforts to ensure all have access to the vital care they need and deserve, regardless of their ability to pay. We have notified the state of our plans to fully participate in the Healthcare Access Stabilization Program and remain committed to helping our patients thrive.
Mecklenburg County commissioner Susan Rodriguez-McDowell, a frequent hospital critic who attended the Wednesday event, said she was thrilled to hear that Novant had signed on.
“And of course, it really brought up in my mind the question of: ‘Where's Atrium?’” she said. “That was my No. 1 question as I walked away.”
Michelle Crouch covers health care. Reach her at mcrouch@northcarolinahealthnews.org.
This article is part of a partnership between The Ledger and North Carolina Health News to produce original health care reporting focused on the Charlotte area. We make these articles available free to all. For more information, or to support this effort with a tax-free gift, click here.
Related Ledger/N.C. Health News articles:
“Can cash coax hospitals to erase medical debt?” (July 19)
“Charlotte leaders urge Atrium to consider new approach on medical debt” (Jan. 29, 2024)
“Charlotte hospitals say ‘no thanks’ to charity’s efforts to reduce medical debt” (Dec. 11, 2023)
—
Coming up in The Ledger: A focus on medical debt
In the coming months, The Ledger and N.C. Health News are stepping up our efforts to provide the community with insights and solutions on the challenge of medical debt.
What questions do you have about medical debt? What are your experiences with medical debt?
Let our health care reporter, Michelle Crouch, know. You can reach her by email at mcrouch@northcarolinahealthnews.org.
—
Need to sign up for this e-newsletter? We offer a free version, as well as paid memberships for full access to all 4 of our local newsletters:
➡️ Opt in or out of different newsletters on your “My Account” page.
➡️ Learn more about The Charlotte Ledger
The Charlotte Ledger is a locally owned media company that delivers smart and essential news through e-newsletters and on a website. We strive for fairness and accuracy and will correct all known errors. The content reflects the independent editorial judgment of The Charlotte Ledger. Any advertising, paid marketing, or sponsored content will be clearly labeled.
Like what we are doing? Feel free to forward this along and to tell a friend.
Social media: On Facebook, Instagram, Twitter and LinkedIn.
Sponsorship information/customer service: email support@cltledger.com.
Executive editor: Tony Mecia; Managing editor: Cristina Bolling; Staff writer: Lindsey Banks; Business manager: Brie Chrisman