CNN report: UAMS sued more than 8,000 patients since 2019 to collect medical debt

The University of Arkansas for Medical Sciences has sued more than 8,000 patients, including hundreds of its own employees, to collect on unpaid medical bills since 2019, according to court records, CNN reported Friday morning.

Most of the lawsuits involved unpaid bills of about $1,000 or less, with some as little as $100, and many resulted in additional court fees or wage garnishment for the defendants, CNN reported.

Among those UAMS sued were more than 500 of its own current and former employees, plus about 100 employees of Arkansas Children’s Hospital, which is affiliated with UAMS.

The majority of the 20 defendants who spoke to CNN were current or former UAMS employees. Many said the lawsuits hobbled them financially, with some taking second jobs to make ends meet, and made them feel as if UAMS cared more about revenue than people.

“Y’all say you’re for the people, but how am I going to survive when you’re taking hundreds of dollars out of my paycheck?” one hospital housekeeper said anonymously due to fear of retaliation. 

The lawsuits were an added difficulty during the COVID-19 pandemic, when UAMS employees were dealing with extra work and the risk of exposure to the virus, CNN reported.

Leslie Taylor, a spokeswoman for UAMS, said in a Friday statement that the state-run hospital’s “approach to billing and collections is designed to be fair” and adheres to American Hospital Association guidelines.

“We have recently established an internal working group to review our current billing methods and develop new processes if needed,” Taylor said.

She added UAMS took legal action against only about 0.0013% of the bills from the roughly 6 million patient visits it has received since 2019.

Taylor also said UAMS does not sue patients who are unemployed, on Medicaid or Medicare, or below 200% of the federal poverty level, which is about $60,000 annually for a family of four.

Financial data

The university says it uses legal action as a last resort after at least 12 months of regular communication with a patient has not resulted in payment, which can be done with a payment plan that can cost as little as $5 or $10 per month.

UAMS Chancellor Cam Patterson made the same comment to CNN, which noted that these policies are not publicly available on the UAMS website.

CNN’s report cited a 2021 audit of UAMS’ finances, which showed that the university regularly makes more than $1 billion per year from patients and insurers, “suggesting that individual debts of a few hundred dollars were a drop in the bucket.”

Patterson told CNN he was not aware of the number of employees the university had sued until CNN informed him.

“We can’t fulfill our mission if we’re not getting paid for the work that we do,” Patterson said.

He added that UAMS provides free medical care to low-income patients and does not “take legal action against people who can’t pay.”

Similarly, Taylor said UAMS writes off about $100 million of patient bills per year “as charity care or as uncollectible.”

In compliance with Arkansas law, UAMS has a publicly available database of unaudited financial records. Those records show that some of the employees UAMS sued for medical debt were making annual salaries of about $30,000 or less, CNN reported.

The university was working on stabilizing its finances in 2019 — the year its medical debt lawsuits spiked from a few dozen to hundreds per year — after cutting hundreds of jobs in 2018 due to a multimillion-dollar budget shortfall.

Last month, UAMS announced it would cut 51 jobs in light of a $30 million budget deficit for fiscal year 2023.

Additionally, the spike in lawsuits came shortly after the university formed a new partnership with Mid-South Adjustment Company, a Pine Bluff debt collection firm that UAMS has paid more than $3.1 million since then, according to CNN.

Representatives of Mid-South did not comment for CNN’s report.