Stony Brook University Hospital suing hundreds of patients over medical debt

Stony Brook University Hospital has been suing patients over medical debt — including sending summonses to those with tumors and other complex health conditions — at a higher rate than other health care systems statewide, records show.

State attorneys have filed more than 950 cases against people believed to owe Stony Brook hospital money in the first half of 2024, according to Suffolk County Supreme Court records. Stony Brook is the area's only regional system suing for unpaid medical bills.

Last year, the Stony Brook system accounted for 52% of all medical debt cases brought by the state's more than 200 hospitals combined, according to one social service group's estimate. The state's budget guidelines, according to Stony Brook, require the hospital to refer certain delinquent accounts to the New York Attorney General’s Office. 

Suing is so widespread that hospital staff are accustomed to having patients frantically present court papers to them, said Lynne Piazza, a social worker who also is facing a medical debt lawsuit from Stony Brook.  

"They’d run to your office . . . crying, worrying about immigration status, worrying about are they going to be able to keep their home," said Piazza, who started as an intern at Stony Brook hospital in 2013 and has taken time off in recent years to deal with her own health issues.

The litigation appears to be far from lucrative. In the six months examined by Newsday, the lawsuits sought a total of $13.7 million, or about 0.8% of the $1.8 billion net patient revenue Stony Brook reported in 2021, the most recent year federal cost data is available. Stony Brook received four judgments — or legal victories over patients — in 2022, according to the most recent institutional cost report available from the state.

Patients say the cases cost them peace of mind. Long Islanders recovering from brain surgery and radiation therapy told Newsday they were hit with lawsuits while barely scraping by. About 5% of the roughly 950 cases filed in the first half of 2024 have been settled. Many of these agreements require patients to pay a nominal amount, sometimes as little as $25 a month, for years — presumably because that’s the most patients can afford, court records show.

Long Islanders named in the lawsuits said they tried to find ways to cover the cost of their treatment. Some applied to Medicaid, a public insurance policy for low-income Americans that can retroactively cover care. Others sought assistance from the hospital’s financial aid program, which may waive or reduce the cost of medical care. Ultimately, these patients said they were hit with bills they couldn't afford, and agonized about how court cases might complicate their future.

"I'm a single mom right now and I have my daughter in college," said Kim Postell, of Yaphank, who is being sued for more than $12,000 for an emergency room visit. "There's no way I can afford that."

As a product of the state’s higher education system, Stony Brook must refer certain delinquent accounts to the New York Attorney General’s Office under government budget guidelines, chief revenue officer Brian Fullerton said. Still, staff members try to protect patients from legal proceedings by steering them through the hospital’s financial aid program, he said. The health system won’t deny anyone care at its hospitals in Stony Brook, Southampton, Greenport or other facilities, regardless of how many unpaid bills someone has, Fullerton said.

A dated approach to debt

Other regional hospital systems — which are all nonprofits or government-run — have moved away from suing over unpaid bills in recent years, and none currently file lawsuits against patients, hospital officials confirmed.

Greater awareness about how medical debt burdens New Yorkers and new state policies have pushed hospitals to modify their approaches, said Elisabeth Benjamin, vice president of health initiatives at the Community Service Society of New York, a nonprofit that assists consumers in accessing health care and navigating insurance and billing. Her group found that Stony Brook filed more than half of the medical debt cases statewide last year.

Hospital executives weren’t always aware that their billing or legal departments were  sending their clients to court, Benjamin said. Court cases may have less impact now that hospitals can't put liens on patients' primary homes, garnish their wages or report medical debt to credit bureaus.

By 2023, state-run hospitals were responsible for most medical debt cases filed in New York, Benjamin said. Stony Brook is behind a big share of these lawsuits, she said.

"This is not the paragon of charitable hospitals," Benjamin said. "They have a higher obligation."

Stony Brook says it doesn’t have much discretion. New York Division of Budget guidelines compel it to send bills of at least $2,500 that have been delinquent for 180 days or more to the attorney general's civil recoveries bureau, Fullerton said. Those with pending financial aid applications or payment plans are excluded, he noted.

"It's really ultimately the attorney general that makes the determination whether or not to sue," Fullerton said.

Gary Ginsburg, spokesman for New York Attorney General Letitia James, declined to explain when the office believes it is obligated to take legal action or to answer other questions on the record.

James' office says it assists patients in getting financial aid, and, when appropriate, reduces or writes off accounts. Still, the attorney general's "civil recoveries bureau is responsible for recouping revenue owed to the state agencies through affirmative litigation," according to state budget guidelines the office referred Newsday to. 

Benjamin contends the state has more flexibility in how it approaches medical debt. She noted that government-run hospitals in other parts of New York blamed the same budget guidelines when health advocates highlighted how many patients they sue. Then the number of lawsuits the civil recoveries bureau filed on their behalf plummeted, she said.

'Unmanageable' stress

Pressure mounts when patients are served by the state's highest law enforcement office, according to Piazza, the social worker. She knows firsthand.

In late 2019, Piazza, 46, took a leave of absence to have brain tumors removed. Multiple surgeries saved her life, but also saddled Piazza with new health issues. Piazza says she’s only recently been cleared to work 12 hours a week.

Her health insurance was cut off midway through Piazza’s recovery due to errors in how her leave was classified, Piazza said. The cancellation was retroactive, and payments for her surgeries and other treatment were clawed back. Piazza, of Northport, estimates she has accumulated some $300,000 in medical bills with several providers, including Stony Brook.

Piazza said she wasn’t able to get various Stony Brook departments to address the situation. So she called the financial aid office, where someone told her they would look into her situation but never got back to her, Piazza said.

This past spring, she got a court summons citing a nearly $19,640 debt to Stony Brook University Hospital.

"There’s no phone call before. They don’t try to work anything out with you: It’s just letters. They send you letters," Piazza said. "My stress level — it’s unmanageable."

Piazza planned to argue her case in court, but said she was too ill to make it that day.

Lawsuits make some patients hesitant to schedule further medical appointments, patient advocates say.

Postell, the single mother in Yaphank, said she was "a little nervous" about scheduling surgery at Stony Brook to have atypical, potential cancerous cells removed from her uterus. But Postell, a bank operations manager, feels more comfortable when she reminds herself that she now has insurance.

When she went to the emergency room in early 2022, Postell had a contract position that didn’t provide insurance. She needed help because excessive vaginal bleeding was causing her to feel faint, Postell said. Once there, staff helped her fill out financial assistance paperwork, but Postell said she never heard about her submission again.

She was surprised when Stony Brook sued her for more than $12,270.

"Why have me sign those papers and do all that if you were going to sue me?" Postell said, adding that she had been given conflicting balance estimates.

Suing isn’t going to change the outlook on Carol Franciosi's account, the Holbrook resident said.

Franciosi, 66, learned she had tumors that could impair her jugular vein during an emergency room visit about two years ago. She went through 35 rounds of radiation treatment and needed more than a year to regain her sense of taste, Franciosi said.

She had been anticipating soon qualifying for Medicare, a public insurance program geared toward seniors, and gone uninsured. A family friend helped her apply for Medicaid, which she believed would retroactively pick up the cost of her care.

Franciosi shared this when Stony Brook personnel called and asked about her bill. She figured everything was fine — and wasn’t sure what to make of a mailed summons stating that she owed Stony Brook more than $19,030.

"Between my rent and everything else, I’m just trying to live," said Franciosi, who gets paid to be a caregiver for her disabled adult daughter and looks after two young grandchildren. "I’m looking at where my next gallon of milk is coming from."

When charity care counts

Stony Brook hospital Chief Executive Carol Gomes said she couldn’t comment on individual patients or personnel matters. The health system, she said, works diligently to help patients get financial aid, but can't do much if people don't stay in touch with the system. 

"Patients have this information, whether it’s at the point of service, at registration, on the bill," Gomes said. "It’s bidirectional. They have to request the assistance in order for us to know that they need help."

When people first call or engage with Stony Brook, staff members try  to assess whether they need help with bills, said Scott Mathesie, regional director of patient financial services. At facilities, customer service representatives, patient advocates, social workers and interpreters  alert people that help is available, he said. Every bill sent to patients mentions the program, Mathesie added.

Stony Brook considers submissions from people earning up to 600% of the federal poverty level, as opposed to the 400% threshold required by the state, Mathesie said. The financial aid office’s three employees handled nearly 6,790 applications in 2022, according to its institutional cost report. The office approved 83% of them, denied less than 2% and had about 15% pending, the document noted. Stony Brook generally reaches determinations within three days, but keeps applications open even when it has lost contact with patients to streamline future reviews, Mathesie said.

Stony Brook, like other hospitals in the state, receives funds from Albany specifically for treating indigent or impoverished people.

Yet, Stony Brook seems to have a relatively small financial aid or charity care program. Its charity care amounted to 0.5% of its operating expense budget in 2021, according to the most recent hospital provider cost report available through the U.S. Centers for Medicare and Medicaid Services, a federal agency that runs public insurance programs and oversees the health sector. That’s less than its peers, according to Ge Bai, an accounting and health policy professor at Johns Hopkins University.

Government-run hospitals in New York State put a median of 1.8% of expenses toward charity care; their counterparts nationwide, 0.9%, said Bai, whose research measured charitable benefits using the same approach taken by the Internal Revenue Service, the agency that oversees nonprofits.

Fullerton called this analysis misleading because it overlooks large sums billed to patients that Stony Brook fails to collect and writes off as bad debt. Health advocates argue some patients in the "bad debt" pool could potentially have avoided the headache of dealing with collectors and court cases if they made it through the financial aid process.

Stony Brook will soon follow budget guidelines revised to reflect a new state law, Division of the Budget spokesman Tim Ruffinen said. Starting in October, medical debt cases must include an affidavit — or official declaration — verifying that the hospital has determined patients’ income is below 400% of the federal poverty level. Those of more modest means may not be sued.

In the meantime, patients say Stony Brook won’t see much from them.

"They’ll get a judgment," Franciosi said. "But I can’t offer them anything . . . They’ll have to wait on line."

By Sarina Trangle

sarina.trangle@newsday.comSarinaTrangle

Sarina Trangle covers affordability and cost of living issues and other business topics. She previously worked as an editor and reporter at amNewYork.