University of Virginia hospital system to cancel thousands of backlogged lawsuits over medical bills

The University of Virginia Health System has announced that it will be canceling decades of court judgments and liens over unpaid medical bills in an effort to reduce some of the financial burden of medical costs for low-income patients. 

UVA Health announced the new policy in a Monday press release, explaining that it plans to “release all liens and judgments for patients who are at or below 400% of the federal poverty level.” 

Based on current federal poverty levels, individuals who would qualify under this new policy include single patients who make less than $51,520 or less, as well as a patient who’s part of a family of four that makes $106,000 or less. 

Douglas E. Lischke, UVA Health’s chief financial officer, said in a statement, “We are committed to providing high-quality, compassionate care to all community members and these new policies and practices uphold our commitment.” 

The move follows previous reforms announced in 2019 prompted by a Kaiser Health News (KHN) investigation that found UVA Health had sued patients 36,000 times over a period of six years for more than $100 million, and often for amounts higher than what a patient would have paid for their medical care. 

KHN noted that upon winning lawsuits, UVA Health could effectively seize wages and the value of patients’ homes once they were sold, and that they had been working to renew claims dating as far back to the 1990s. 

In response, UVA Health suspended lawsuits against patients and wage garnishments, and also increased discounts for uninsured patients and provided additional financial assistance. 

UVA Health also announced Monday that it is in the process of establishing an Ombudsperson’s office to help patients determine the best payment options and to impartially assess an individual’s medical costs. 

Some have already praised UVA Health for its billing policy changes, with Georgia State University law professor Erin Fuse Brown, who studies hospital billing, telling The Washington Post Tuesday that they were “very significant and a much-needed and overdue step.” 

UVA Health’s decision to reduce lawsuits and erase liens, however, stops short of changes announced last year by Virginia Commonwealth University’s health system. 

VCU Health said last March that it would no longer sue patients over medical bills, and also committed to ending all previous judgments and liens regardless of a patient’s income level.