Community Health Centers Pursue Patients for Medical Debt

Federal funding is intended to ensure that community health centers provide accessible medical care, but a troubling trend has emerged: facilities like PrairieStar Health Center in Kansas are suing patients for unpaid medical bills. This situation highlights the challenges faced by many low-income families who rely on these centers for essential health services.

Ashley Voss-Barnes, a nurse from south-central Kansas, received a court summons in June 2023, notifying her that PrairieStar was suing her for $675 and her wife for $732 in unpaid medical bills. Voss-Barnes, who had previously set up an automatic payment plan with the clinic, was blindsided by the lawsuit. Despite her efforts to manage her family’s medical expenses, which includes five children, she found herself facing legal action without prior warning.

In court filings, Voss-Barnes asserted that PrairieStar had not communicated that her payments were insufficient to prevent her account from going to collections. She expressed her frustration, stating, “If I have something due, then I will try to pay it. It came out of nowhere.” After consulting a local lawyer who deemed the debt too small to pursue, Voss-Barnes chose to represent herself and filed an objection to the lawsuit, requesting to continue her existing payment plan.

Ultimately, Voss-Barnes and her wife established new payment agreements with a collections agency to avoid wage garnishment. However, they ended up incurring additional costs in interest, court fees, and legal expenses, raising concerns over the potential for further lawsuits from PrairieStar. Voss-Barnes noted, “I know we’re not the only ones this has happened to,” reflecting the broader issue of community health centers suing patients for unpaid debts.

According to an analysis by ProPublica, PrairieStar Health Center has filed at least 1,000 lawsuits against patients since 2020, primarily targeting those who are uninsured and would qualify for discounted care. Community health centers, established during the Civil Rights Movement to address healthcare disparities, are meant to provide services regardless of a patient’s ability to pay. However, the trend of pursuing litigation against patients contradicts this mission, raising ethical concerns.

Leaders from several community health centers, including PrairieStar, defended their actions, claiming that lawsuits are a last resort after multiple attempts to collect debts. PrairieStar’s CEO, Bryant Anderson, described the clinic’s financial challenges, stating that the organization operates under a “perfect storm” of higher operational costs and unstable funding streams. He emphasized that every patient is offered the opportunity to apply for sliding-scale discounts based on income, though many choose not to disclose their financial information.

Other community health centers have also faced scrutiny for similar practices. For example, Eastern Shore Rural Health in Virginia has filed over 7,000 lawsuits for unpaid medical bills in the last decade. One case involved suing a couple for $59, which ballooned to over $400 due to additional fees. The organization employs a collections agency that takes a significant percentage of recovered funds, further complicating the financial burden on patients.

Public attention on medical debt has primarily focused on nonprofit hospitals, which are mandated by law to evaluate patients for financial assistance before pursuing collections. In contrast, community health centers must make “every reasonable effort” to collect from patients before writing off debts, a requirement that some experts argue is being interpreted too broadly. According to Ray Jorgensen, a healthcare billing consultant, “There’s no law that says you have to garnish wages or that you have to go after someone through collections.”

Voss-Barnes’ case is emblematic of a larger issue facing many families who depend on community health centers for care. Medical debt disproportionately impacts low-income and minority groups, creating barriers to healthcare access. Miriam Straus, a policy advisor for Community Catalyst, noted that patients who have been sued over medical debt may avoid seeking care in the future, exacerbating health disparities.

In Hutchinson, Kansas, the establishment of PrairieStar Health Center was a response to a lack of accessible healthcare options. However, the center’s current approach to debt collection raises questions about its commitment to serving vulnerable populations. Aimee Jones, a former patient accounts representative at PrairieStar, expressed regret over policies that led to collections, noting that many patients struggle to pay even minimal amounts.

The financial impact of lawsuits and collections on patients can be devastating. For instance, Brittney Shea, a single mother, has faced multiple lawsuits from Eastern Shore Rural Health, resulting in wage garnishments that have made it difficult for her to provide for her family. The cycle of debt and legal action has forced her to make difficult decisions about when to seek medical care.

Despite the challenges, some community health center leaders are choosing a different path. Krista Postai, founder of the Community Health Center of Southeast Kansas, has made a commitment to avoid outsourcing debt collection, emphasizing the importance of maintaining patient dignity. Her center strives to provide care to those who cannot afford immediate payment, opting instead to work creatively with patients to ensure they receive necessary medical attention.

The ongoing issue of medical debt and community health centers highlights the need for reform in how healthcare providers approach collections. The National Consumer Law Center advocates for measures to limit aggressive debt collection practices, suggesting that states establish caps on interest rates and prohibit lawsuits for patients qualifying for financial assistance.

As the landscape of healthcare continues to evolve, the focus must remain on ensuring that all individuals have access to affordable and compassionate care, without the burden of overwhelming debt.