Editors Note: Collections & Credit Risk is committed to updating readers about how the mainstream media and independent reports are portraying the collection industry. At times, the news surprises readers. Mostly, a formula is followed.
What follows are excerpts from an editorial published this week in The News & Observer, based in Raleigh, N.C.
The editorial reviewed medical collections in North Carolina. It stated that state law, the Affordable Care Act and a 2012 article series published by the newspaper has led nonprofit hospitals to become less aggressive in pursuing former patients who cant pay their bills.
"Thats a break not just for patients, but also for the hospitals themselves. Lawsuits, or pursuit by collection agencies to the point of ruining peoples credit, are a business that hospitals dont need to be in and that most really dont want to be in. It runs counter to the obligation of the medical profession to heal without regard to ability to pay, something thats also fundamental to the mission of nonprofits.
The editorial noted that collection lawsuits by the states hospitals dropped by more than 43% from 2010 to 2014 - and some hospitals stopped pursuing lawsuits entirely.
"The Affordable Care Act, which has made it possible for many who were uninsured to get insurance, should reduce the need for lawsuits even more. A lack of insurance is a major reason people cant pay their medical bills, which come to them in retail form rather than reflecting the discounts insurance companies negotiate.
"Its true, of course, that some people who can afford to pay just dont, and hospitals should have recourse to pursue them. But going after people to the point of ruining them financially when they cant pay the bills because they have inadequate or no insurance is wrong, the editorial continued.
The newspaper reports that its 2012 series helped lead to a state law in 2013 that curbed certain aggressive debt collection tactics.