For 15 years, Donna and Gary Lindabury, of Vylas, North Carolina, lived with the financial equivalent of an anvil over their heads: a medical debt owed to a nonprofit hospital that at one point reached $200,000.
The debt, owed to Atrium Health for emergency heart surgery Gary underwent in 2009, grew over the years to include almost $100,000 in interest charges, Donna, 72, told NBC News. “We were striving, we were trying, we paid our bills,” she said. “But I just couldn’t afford to pay that hospital.”
As the years went by and the debt remained, the hospital system placed a lien on the Lindaburys’ home, allowing it to recover what was owed if the couple sold the property.
“We’ve been just so consumed with just trying to get by with this problem,” Gary, 80, said.
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Then, in early November, the Lindaburys received a letter from Atrium Health telling them it was removing what was left on the lien — $92,262 — and leaving them free and clear of any obligation to the hospital.
They were among the beneficiaries of a decision the hospital system announced in September to release 11,500 liens on people’s homes in North Carolina and five other states, some of which dated back 20 years or more.
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“It is like a miracle,” Donna said. “We just thought we’re never going to own our house and be able to pass it down to our kids.”
A spokesman for Atrium Health provided a statement saying the mission of its parent company, Advocate Health, “is to provide access to high-quality care for everyone in the communities we serve, no matter their financial circumstances.”
“As a leader in health care, we have long been committed to programs that help people struggling with medical debt,” the statement added. “Removing judgment liens on homes to recover unpaid medical bills was a natural next step in our continuing efforts to make sure patients aren’t burdened by medical costs.”
Almost 18% of the U.S.’ gross domestic product goes to health care — far more than other developed countries — with roughly one-third of those dollars spent on hospital care, according to National Health Expenditures data. And as health care costs rise, more and more patients struggle to pay for their care, even those with insurance.
Americans owe $220 billion in medical debt, according to KFF, a nonprofit health policy research, polling and news organization. Health care expenses are a top cause of bankruptcy in the U.S., a 2019 study published in the American Journal of Public Health found. Research conducted by the Urban Institute found that medical debt is more common in the South and among people in low-income ZIP codes. In 2021, the institute found that three North Carolina counties were among the 10 U.S. counties whose residents held the most medical debt.
Advocate Health’s decision to release thousands of liens on former patients’ homes came after NBC News detailed how its Atrium Health unit aggressively pursued patients’ medical debts.
Medical debt judgments can last up to 20 years in North Carolina, and according to a study by Duke University School of Law faculty and the Office of State Treasurer, hospitals in the state sued 7,517 patients and their family members to collect medical debt from January 2017 through June 2022.
Many of these suits resulted in default judgments and allowed for 8% interest charges, inflating the amounts owed as occurred in the Lindaburys’ case. In total, the report said, interest charges and other added fees accounted for 35% of the $57.3 million in total judgments owed by patients.
Under a provision of the Affordable Care Act, nonprofit hospitals are supposed to offer financial assistance programs to patients who can’t afford care, but patients don’t always receive information about these programs, health care experts say.
Recognizing the burden that medical debt places on consumers, some states have moved in recent years to remedy the problem. Arizona and Colorado now cap the interest rates levied on medical debt, while Delaware recently passed a law prohibiting interest and late fees on these bills. Maryland requires hospitals to reimburse patients who paid their bills but should have been eligible for financial assistance.
Back in North Carolina, the Lindaburys are still processing the release of their debt burden. “It’s like being in prison,” Donna said, “and now you’re out.”
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