One Hospital System Sued 2,500 Patients After Pandemic Hit

By Brian M. Rosenthal

The largest health system in New York, led by a close ally of the governor, continued to sue over medical debt during the Covid-19 crisis, even after other big hospitals suspended lawsuits.

Medical debt lawsuits have become increasingly common in recent years.
Medical debt lawsuits have become increasingly common in recent years.Credit...Victor J. Blue for The New York Times
Brian M. Rosenthal

When the coronavirus began spreading through New York, Gov. Andrew M. Cuomo ordered state-run hospitals to stop suing patients over unpaid medical bills, and almost all of the major private hospitals in the state voluntarily followed suit by suspending their claims.

But one chain of hospitals plowed ahead with thousands of lawsuits: Northwell Health, which is the state’s largest health system and is run by one of Mr. Cuomo’s closest allies.

The nonprofit Northwell sued more than 2,500 patients last year, records show, a flood of litigation even as the pandemic has led to widespread job losses and economic uncertainty.

The Northwell lawsuits each sought an average of $1,700 in unpaid bills, plus large interest payments. They hit teachers, construction workers, grocery store employees and others, including some who had lost work in the pandemic or gotten sick themselves.

“My salary was cut in half. I’m now working only two days a week. And now I have to deal with this,” said Carlos Castillo, a hotel worker in New York City who was sued for $4,043 after being hospitalized with a seizure at Long Island Jewish Medical Center, which is part of the Northwell system. Mr. Castillo, 37, said he was worried the hospital would seize his paychecks and leave him unable to pay rent.

After this article was published Tuesday morning, Northwell abruptly announced it would stop suing patients during the pandemic and would rescind all legal claims it filed in 2020.

Across the country, medical debt lawsuits have grown increasingly common in recent years, as health care costs have risen and insurance companies have shifted more of the burden onto patients through larger deductibles and co-payments. The cases are rarely contested in court and usually lead to default judgments, allowing hospitals to garnish wages and freeze accounts to extract money, sometimes without the patient’s knowledge.

Northwell had not been alone in pursuing debt through the courts during the pandemic. About 50 hospitals in New York have sued a total of 5,000 patients since March, according to a search of filings in courts around the state. Most are small and located upstate.

Northwell stood out because of the sheer number of its lawsuits — and because of its connections to Mr. Cuomo. The other major New York City hospital systems, including NewYork-Presbyterian and NYU Langone Health, have largely suspended lawsuits during the pandemic. It is unclear when they might begin suing again.

The Northwell system operates 23 hospitals, including Long Island Jewish Medical Center, Lenox Hill Hospital and North Shore University Hospital. It brings in about $12.5 billion in annual revenue and received $1.2 billion in emergency funding through the stimulus package in the federal CARES Act last year.

It sued over unpaid bills as small as $700 last year, records show.

Northwell’s chief executive officer, Michael Dowling, was the state health director and deputy secretary to former Gov. Mario Cuomo, the current governor’s late father, and he has been a close friend to the younger Mr. Cuomo for more than three decades.

During the pandemic, Mr. Dowling has served as the governor’s closest ally in the hospital industry and his liaison to all of the state’s hospitals. He has set up meetings and delivered messages for Mr. Cuomo, led a council to increase bed capacity at hospitals, overseen patient transfers to field hospitals and worked with the state on studies of antibody test results that have been used to identify hot spots for the virus.

Mr. Dowling has also appeared frequently with Mr. Cuomo at the governor’s news briefings; both men wrote books this year, and Mr. Cuomo wrote a blurb promoting Mr. Dowling’s writing.

Northwell received the first doses of the coronavirus vaccine in the state last month.

Barbara Osborn, a Northwell spokeswoman, declined to say whether Mr. Dowling had discussed the lawsuits with Mr. Cuomo. A spokesman for the governor did not respond to requests for comment.

In an interview last month, Richard Miller, the system’s chief business strategy officer, defended the cases, saying Northwell had the right to collect what it was owed. He said that Northwell has a financial-assistance program for low-income patients that is more generous than required by the government, and he said the system sues only employed patients that it believes have the ability to pay and who do not respond to outreach attempts.

“We have no interest in pursing these cases legally. It’s not what we want to do,” Mr. Miller said, before the hospital changed course on Tuesday. “Unfortunately, in some cases, they’re not leaving us much of an option.”

Mr. Miller said that even with the stimulus money, Northwell lost $300 million last year.

He also said that all of the suits that Northwell had filed in 2020 stemmed from hospitalizations that occurred months or years before the pandemic began.

The other health systems that filed the most lawsuits last year echoed that sentiment, emphasizing that they have not sued any coronavirus patients.

St. Peter’s Health Partners, which runs a chain of hospitals in the Albany area and filed about 1,000 lawsuits last year, and Oneida Health, a health care system near Syracuse that filed about 500 lawsuits, both said in statements that they temporarily stopped suing in the spring but resumed over the summer.

Updated Dec 30, 2020

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Elisabeth Benjamin, vice president of health initiatives at the Community Service Society, a nonprofit that advocates anti-poverty policies, criticized hospitals for suing patients during the pandemic, even over unpaid bills from hospitalizations in past years.

She said that a few hundred dollars may not mean much to a hospital chain but can be a significant burden for a low-income patient. “It means someone is going hungry,” Ms. Benjamin said. “It means a kid is not getting a winter coat.”

In some cases, the lawsuits sought even larger sums. John T. Mather Memorial Hospital on Long Island, which is owned by Northwell, sued Thomas Kasper in April for $31,340 in unpaid bills — plus about $8,000 in interest and fees, records show.

That hospital sued Scott Buckley for $21,028, plus about $4,000 in interest and fees.

“I am literally broke,” said Mr. Buckley, 48, who works at a Stop & Shop grocery store. “I don’t have a penny to my name. I have three kids. If they take my paycheck, I won’t have anything.”

One of Mr. Buckley’s daughters, Kacey Buckley, 22, who works for a cat breeder, was also sued over unpaid medical bills in an unrelated case, records show. Northwell had recently begun garnishing 10 percent of her paycheck.

The Community Service Society published a report on medical debt lawsuits earlier last year. Ms. Benjamin said the group’s latest numbers showed that New York’s nonprofit hospitals had filed more than 40,000 lawsuits against patients between 2015 and 2019.

The group found that Northwell sued patients far more often than any other hospital chain — about 14,000 in that period, or about 2,800 a year. That was about one-third of the suits identified by the advocacy group; Northwell operates only about one-tenth of the hospitals in the state.

Northwell filed fewer cases last year, but not by much.

State lawmakers introduced legislation last year that would increase transparency in medical billing, limit the time period in which hospitals can sue and cap the interest that hospitals can collect.

The bill’s sponsors, Assemblyman Richard Gottfried and Senator Gustavo Rivera, both Democrats who chair their chamber’s health committees, said the lawsuits filed during the pandemic were evidence of the importance of the proposal.

Still, they said, it will be difficult to pass the bill in Albany, where the hospital industry has a lot of clout.

“It’s going to be difficult, there’s no doubt,” Mr. Rivera said. “The hospitals are powerful.”

Susan C. Beachy contributed research.