Attorney General Ellison protects Minnesotans from unfair billing and collections with extension of Hospital Agreement

Attorney General’s Office secures 5-year extension to ensure valuable protections for Minnesota patients continue through 2027

July 27, 2021 (SAINT PAUL) — Minnesota Attorney General Keith Ellison announced today that his Office has negotiated an extension to the regulatory agreement that the Attorney General’s Office holds with all nonprofit hospitals in Minnesota, referred to as the “Hospital Agreement.” The Agreement provides important protections to Minnesotans who receive healthcare services at Minnesota’s hospitals by protecting patients from abusive, harassing, and deceptive practices when hospitals seek to collect medical debt. The Agreement also provides discounts on healthcare services for certain patients and prohibits unfair practices in billing and collections.  

The Agreement covers all 128 nonprofit hospitals in Minnesota — and for the first time, covers one of Minnesota’s two for-profit hospital systems, PrairieCare. The Hospital Agreement, which has been filed in Ramsey County District Court, is effective for a five-year term that expires on July 1, 2027. 

“It’s my job to keep Minnesotans safe from abusive billing and debt collection that can rob them of dignity and respect. That’s all the more important at a time of rising inflation and skyrocketing medical bills that make it tough to afford your life,” Attorney General Ellison said. “The Hospital Agreement is now a tradition of the Attorney General’s Office that Minnesotans count on to protect them from abusive medical billing and debt collection and help them afford their lives. As long as I’m attorney general, I will keep enforcing it.” 

Under the Agreement, hospitals must abide by their obligations as charitable organizations to meet certain standards of conduct imposed by their charitable missions. The Agreement requires hospitals to develop policies for assessing patients’ ability to pay, and to provide free healthcare, known as “charity care,” to qualifying patients. The Agreement also requires each hospital’s board of directors to take an active role in managing their facilities’ billing and debt collection practices. For example, the hospitals’ boards are required to adopt “[a] zero tolerance policy for abusive, harassing, oppressive, false, deceptive, or misleading language” when “collecting medical debt from patients.” Hospitals must also offer patients reasonable payment plans that treat them fairly “taking into account each individual’s ability to contribute to the cost of his or her care[.]”  

In addition to the protections listed above, the Hospital Agreement also affords patients many other protections, including:  

• Hospitals must not charge uninsured patients more than they charged their “most favored insurer” for treatment and “shall apply the same percentage discount . . . for insured treatment that [they] would apply to charges incurred by a policyholder of its most favored insurer.” 
• Hospitals must require the debt collection agencies with whom they contract to follow the provisions of the Hospital Agreement and cannot give their debt collectors blanket authority to take legal action against patients to collect medical debt. 
• Hospitals must offer a reasonable payment plan to patients who are unable to pay the full amount of their bill before pursuing the debt in litigation, garnishing patient wages, or referring debt to a collection agency. Hospitals may not refer debt to a collection agency if the patient makes payments in accordance with the terms of the payment plan that the hospital agreed to.   
• Neither hospitals nor their debt collection agencies may report patients to credit reporting agencies for failing to pay a medical bill. 

Recent enforcement action under Hospital Agreement 

In October 2020, Attorney General Ellison reached a settlement agreement with Hutchinson Hospital under the terms of the Hospital Agreement. The settlement required Hutchinson Hospital to restore more favorable hospital billing terms that it had unilaterally terminated for many of its patients, which had the effect of increasing their monthly medical bills beyond what patients agreed to pay. In June 2021, Attorney General Ellison announced that per the terms of the settlement agreement, Hutchinson Hospital had forgiven $184,000 of patients’ medical debt and had allowed certain patients to receive a 40% discount on outstanding medical bills. 

The Minnesota Attorney General’s Office instituted the Hospital Agreement in 2005 following a compliance review of a Minnesota healthcare provider that revealed numerous problems with hospitals’ collection activities, billing practices for uninsured patients, and the administration of charity care. The Attorney General’s Office and Minnesota’s non-profit hospitals subsequently renewed the Hospital Agreement in 2007, 2012, and 2017, each time for an additional five years.  

Dedicated email address for reporting concerns with medical billing or debt collection 

If you think you have been the victim of unfair or unreasonable medical billing or debt collection practices, please contact the Attorney General’s Office at hospital.billing@ag.state.mn.us, a dedicated email address that the renewed Agreement has established for the first time through which Minnesotans may report their issues or concerns with hospital billing. You may also submit an online complaint form on the Attorney General’s website at www.ag.state.mn.us/Office/Complaint.asp. In addition, you may call the Attorney General’s Office at (651) 296-3353 (Metro area) or (800) 657-3787 (Greater Minnesota), or write the office at 445 Minnesota Street, Suite 600, Saint Paul MN 55101. 

Minnesotans may also learn more about their rights through two publications available on the Attorney General’s website: Medical Billing Pointers and Debt Collection Fact Sheet.