CA Legislature Spits in Faces of Medical Debtors. We the People Are Doing Better.

You think it'd be a no-brainer. After multiple articles, national attention, much bewailing and pledges to correct the injustice, it should be tough to screw it up. But screw it up the California Legislature did. They failed to enact legislation to stop one of the more egregious injustices in our health care system (but far from the only one…).

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The particular injustice that I speak of is that of insurees needing to go to an emergency room, some unconscious, getting life-saving treatment, then months afterwards being hit by hospital and service provider bills that their insurers refuse to pay. (This because their insurer has no contract with the hospital in question. So, for example, a hospital bills $30,000 for an emergency appendectomy, but the patient's insurer will only pay $10,000 because that is the rate the insurance company has negotiated for hospitals it has contracts with. Ultimately, the bill for the remaining $20,000 ends up in the insuree's mailbox.)

Other states have managed to enact legislation to curb this (e.g. Colorado), so you might think the California legislature could also have found its way to “JUST SAYING NO” to this practice.

Alas, on July 10th, Assemblyperson David Chiu of San Francisco (the locale whose public hospital was the first to be exposed nationally doing this) announced that his legislation – designed to outlaw such practices – had stalled, that he was suspending the legislation, saving it to potentially be voted on in the 2020 legislative session should he be able to roust up more support. As CBS Sacramento reported

Democratic Assemblyman David Chiu said Wednesday that he’s pulling his bill for now due to staunch opposition from hospitals… He says the bill faced opposition from hospitals trying to protect profits over patients.

And the San Francisco Chronicle editorial page recently bemoaned the legislature for this failure:

One of the bills that won't make its way out of the Capitol this year is state Assemblyman David Chiu's AB1611, which was inspired by San Francisco General Hospital's billing practices…

Okay, it's not like the CA legislature has done nothing in the way of health care legislation. They expanded Medicaid to cover more residents and they've made more people eligible for subsidies, to name a couple of things.

But they've really dropped the ball on things that should be no-brainers: Banning 'Surprise' billing, as it is called above, for one. Capping the cost of insulin (or, more generally, what anyone has to pay for life-saving drugs), for another.  And of course they never even picked up the ball in the first place on what we really need: the transition to a single payer, no cost at point of service, health care as a human right for all system. To their everlasting shame.

Some people are doing a better job. Aside from the fact that it isn’t their job. There are the GoFundMes for those in immediate peril. And around the country, churches, nurses, teens, and activist groups have created campaigns to raise money that have resulted in the elimination of thousands of people's medical debts, totaling hundreds of millions of dollars.

When someone receives a $50,000 medical bill and they can't pay it, that debt gets sold to debt collectors by the hospital or service provider it was originally owed to  – bundled up with other people's medical debts that can't be paid either. The harassing phone calls, letters and threats of legal action never stop, but eventually the debt becomes worth so little that the current owner is willing to sell it for – get this – less than a penny on the dollar.  So for $100, someone can buy up $10,000 of medical debt and try to collect on it – or rip it up. John Oliver explains the process in this video (long version, short version).

Which is what we and these other efforts are doing. Buying it and ripping it up!

An activist group I belong to, Strike Debt Bay Area, has partnered with a national charity, RIP Medical Debt, to do this. We' raise the money for them to use and they use their expertise about the medical debt market to buy up medical debt in the Bay Area and burn it.

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We've partnered with another Bay Area campaign, and together we've almost reached the threshold to begin buying up debt. Our goal is $15,000 and we need just $1800 more.  The more we receive, the more debt that will be forgiven.

RIP Medical debt is going to begin buying up bundles of Bay Area medical debt in a month or so.  If you'd like to contribute to this effort, please donate!

SDBA Medical Debt Elimination Campaign  

We don't all have the (unused) power, like the California legislature, to ensure that surprise medical debt isn't a thing, or that the concept of medical debt be relegated to the dust heap of history.  But we do have the power to leverage small dollar amounts into a lot less anxiety, guilt, and hassling; the power to eliminate credit problems and legal repercussions; all for a bunch of our neighbors in medical debt.

Your contribution will help! 

SDBA Medical Debt Elimination Campaign  

Thanks.