Legislature considering changes to medical lien law after lawsuit revealed MultiCare’s collection practices
A state lawmaker who represents Tacoma wants to tighten some aspects of medical lien law, in response to some billing practices brought to light by a lawsuit against Pierce County’s largest private employer, MultiCare Health Systems.
The bill by Rep. Laurie Jinkins, D-Tacoma, would more tightly regulate any third-party vendors who issue medical liens, as well as to require medical providers to tell patients up front that they use medical liens as part of their billing practices. The bill also creates a way for a person to collect damages if a medical lien isn’t immediately removed when a person pays the debt.
“I try not to do bills about single incidents,” Jinkins said Wednesday. However, she said this legislation is “a warning shot” to ensure other health systems walk the line on use of medical liens.
“We want to see how the medical systems react,” she said.
State law allows some health-care providers, including hospitals and doctors, to seek medical liens to recover the cost of providing care to patients who have no medical insurance or other ways to pay. Medical liens — essentially a claim for payment — show up on credit reports and can make it hard, for example, for a person to buy or sell property.
In the case of MultiCare, a group of former MultiCare patients sued the health system and its third-party vendor, a California-based company, alleging it had filed thousands of liens improperly starting in 2010. The vendor used a notary public who was illegally registered in Washington state to file many of the liens, the patients alleged.
MultiCare denied wrongdoing and blamed its vendor and a former employee for the aggressive collection practices. The vendor was fired and filed for bankruptcy protection, and the employee no longer works for MultiCare.
The health system settled the lawsuit last fall for $7.5 million.