Folwell sounds alarm on medical debt, heavy-handed collection tactics

State treasurer Dale Folwell appeared with some Duke University scholars today in support of their research and Senate Bill 321, the Medical Debt De-Weaponization Act, which currently sits before the NC House:

[…] North Carolina hospitals sued 7,517 patients and their family members to collect medical debt from January 2017 through June 2022, according to a new study jointly authored by Duke Law School faculty and the Office of State Treasurer (OST). Many of these legal actions resulted in default judgments in state district courts and included awards of 8% interest charges on patients’ medical debt. In total, interest charges and other added fees accounted for 35.4% of the $57.3 million in total judgments owed by patients. Nonprofit hospitals were responsible for 90.6% of the 5,922 lawsuits against patients.

State Treasurer Dale R. Folwell, CPA, cites the study as a new reason to call on the state House of Representatives to pass Senate Bill 321, the Medical Debt De-Weaponization Act. The bill would protect patients and their families by capping interest in medical debt collection, requiring more transparency in medical bills and providing patients with additional consumer protections, the treasurer said. The Senate unanimously passed the bill despite opposition from hospital lobbyists.

“This is tantamount to elder abuse,” said Treasurer Folwell. “Hospitals are supposed to care for patients — not overcharge them, sue them and take their homes. These hospitals are destroying the upward mobility of whole families, hurting cancer patients’ recovery, and creating intergenerational poverty. They must be stopped.”[…]

Folwell and the researchers released a number of patient interviews detailing nightmarish collection tactics by big hospitals:

[…] Total Judgment: $192,384.84

Atrium Health charged a 70-year-old couple $100,627.60 in interest.

This 70-year-old couple owes $100,627.60 in interest to Atrium Health for medical bills that are more than a decade old. These interest charges doubled the size of their original $91,402.24 debt to a total of $192,384.84. Every day, interest adds $20.03 to their debt.

When her husband suffered a heart attack in 2009, he was uninsured and only months away from qualifying for Medicare coverage. Worried about cost, the couple asked if they could postpone heart surgery by treating his condition with medication, but the hospital refused.

“They said that if you ever walk out these doors, you will never be allowed to come back and have that procedure here. They put us in a really difficult situation because my husband just about died. I’m trying to keep him alive, and they said we can’t come back. … We weren’t stupid — I knew a heart surgery would cost thousands. … I guess they can take everything I have because I can’t let him die.”

She said that hospital employees assured her that her husband could recieve financial help with the bills.

“They told me that they would help us, they told me we wouldn’t lose our house. … Well, that didn’t happen. The hospital took our house.”

The couple applied for financial assistance and were denied.

“I was making $27,000, and my husband wasn’t making anything. We were just over the threshold to qualify. We applied for everything and were denied. I could have stopped working to get help, but that’s not me. I’m not going to live off the system. I am a working individual. I have a job and I’m grateful.”

For a time, the couple attempted to pay the hospital bill, but they soon realized that the interest charges added hundreds of dollars to their debt every month.

“The bill we owed them was so huge. My little bit of money was not making any dent. And that was when everything had gone to pot with the economy, and I decided that we needed to eat.”

The hospital that originally billed them later merged with Atrium Health, and the couple hoped that the debt would be written off in the merger. Instead, Atrium Health filed to extend the judgment for another 10 years. North Carolina law allows judgments against debtors to last for up to 20 years, and interest accrues at a rate of 8% each year.

“The hospitals are very vicious. I’m 70 years old, and I’m still working, knowing that we will never have any equity in this house. We’re just thankful that they didn’t put us out on the road because they could’ve. We’re not rich people. We went though everything to get help on those bills, and they said no.”

Medical bills have crushed their hopes for retirement.


We will never retire. We’re paying medical bills out the wazoo. My husband has kidney cancer, heart problems, he’s been very sick. For me to quit, I can’t. … I cannot afford for him not to be in his house until the day he dies — even though it’s not his house. It’s the hospital’s house.”

She now pays Atrium Health $35 a month, knowing that she will never pay off the bill.

“They’ll take everything you have. I’m not rich, I can’t pay a quarter of a million dollars. It’s been heartbreaking because I take care of the house, pay insurance, taxes, and they’re going to take my house. My family does not have an inheritance.”

“People, where their God is money, they just don’t care.”[…]