October 12, 2022

Group files suit against hospital over court actions against low-income patients for unpaid bills

Joe Gratz

Flickr/cc

A nonprofit legal group filed a class action lawsuit against Mountain View Regional Medical Center in Las Cruces, alleging that the hospital has illegally sued hundreds of low-income New Mexico patients who should be protected by a new state law from legal action over unpaid bills.

According to the New Mexico Center on Law and Poverty, the Carlsbad hospital has taken more than 200 people to court in 2021 who earned less than 200 percent of the federal poverty line (a little over $24,000 for a single adult or $53,000 for a family of four). That’s despite Gov. Michelle Lujan Grisham signing the Patients’ Debt Collection Protection Act into law last year, which is supposed to protect low-income state residents from having their medical bills sent to collections agencies or court.

The firm also named Faber & Brand, LLC – a Missouri-based law firm that Mountain View often hires to pursue legal action against people with unpaid medical bills – as a defendant.

The law firm Mountain View keeps on retainer did not immediately return inquiries. 

Hospital spokeswoman Serena Duran said in a statement that administrators “previously implemented policies and procedures to ensure compliance with the law.

“We are not aware of any departure from those policies and procedures,” Duran said in an email. “We will review the allegations in the lawsuit and work with the New Mexico Center on Law and Poverty if the review identifies mistakes or departures from the hospital’s policies and procedures.”

Under the law, hospitals have been required since late December of 2021 to make sure that patients’ don’t earn less than 200 percent of the federal poverty line before sending unpaid bills to collections or court. 

But that didn’t stop Mountain View from taking Ruby Ramirez to court, the New Mexico Center on Law and Poverty alleges. 

“Last year I had an emergency while I was pregnant with my third child,” Ramirez, a plaintiff in the lawsuit, said in a statement. The nonprofit declined to make Ramirez available for an interview.

“I rushed to the hospital to make sure nothing was wrong with my pregnancy,” Ramirez continued in a prepared statement. “Almost a year later, the hospital sued me for over $6,000. My family is on a very tight budget. We can’t afford this lawsuit.”

According to the New Mexico Center on Law and Poverty and Treinen Law Office, which is also representing class-action plaintiffs, Ramirez’s income should protect her from lawsuits over her medical debt. But the firm alleges Mountain View sued her anyway.

The firms allege that Mountain View is in violation of both state and federal law in its pursuit to recoup medical debt. The hospital is owned by Community Health Systems, Inc., a Tennessee-based private hospital network that owns Carlsbad Medical Center and other hospitals across the sunbelt. The two hospitals are considered by some health care consumer protection watchdogs to be the most aggressive in the state when it comes to recouping unpaid bills.

“When you go to the hospital, your primary worry should be your health, not being sent to court,” Nicolas Cordova, an attorney for the nonprofit law firm, said in a statement Wednesday. “The New Mexico Legislature passed the medical debt law to take these aggressive collection practices off the table for hospitals. It’s time they follow the law.”

A spokesman for Community Health Systems did not immediately return a phone call or email.

NM Political Report previously reported that hospitals had been taking patients to court without verifying whether income fell below the state threshold for protection.

In December, 2021 alone, Mountain View and Carlsbad Regional Medical Center took close to 100 people to court over unpaid bills, NM Political Report showed. The economic hardship of the pandemic did not slow legal filings, which advocates for medical debtors call an aggressive step for hospitals to take.

Carlsbad Medical Center – which is the only hospital in Carlsbad – has a long history of taking swift and frequent legal action against patients struggling with debt. A New York Times investigation found that the hospital filed close to 3,000 lawsuits against patients from 2015 through 2019, reporting that “few hospitals sue so many patients so often.”

Attorney General’s Office spokeswoman Jerri Mares said in July that the office was investigating “multiple complaints” of failing to properly screen patients’ income status under the new state law, along with both Mountain View and Carlsbad Medical Center.

Attorney General Hector Balderas said in a statement Wednesday, “We actively monitor private class action litigation as a risk factor when evaluating next steps, and while our review of this hospital’s billing practices is ongoing, we support the Center taking private action on behalf of impacted parties.”

Update: Added a statement from the hospital spokesperson.