Updated at 9:10 a.m. ET on August 29, 2019.
On March 8, 2011, Joclyn Krevat, an occupational therapist in New York, was sitting at her computer when she received a most unusual LinkedIn request. The wording was the familiar: “I’d like to add you to my professional network.” The sender was familiar, too, but not for the reason Krevat expected. It was from a debt collector.
Karen Pollack, the head of a debt-collections practice called KP Recovery Solutions, had been trying to collect on some medical bills Krevat had recently incurred for a heart transplant. Krevat’s debts, which were reviewed by The Atlantic, made up plot points in the worst kind of American health-care horror story. In December 2009, Krevat, who was 32 at the time, thought she was coming down with the flu. Instead, she was admitted to the hospital and diagnosed with giant cell myocarditis, a severe inflammatory heart disease that can lead to heart failure. After seven weeks on life support, a heart became available, and she had a transplant. For a year afterward, she wasn’t able to return to work.
Krevat’s husband was a teacher, and Krevat had good insurance through him. But some of the doctors who treated her turned out to be out-of-network—a situation she couldn’t control, because she did not know when a new heart would become available. She estimates that if she had paid every bill that was sent to her, the total would have been about $50,000.
The LinkedIn request was an extreme example of what happens when medical bills go unpaid. Even bills incurred in an emergency can be sent to debt collectors or sold to debt buyers, who will attempt to collect on them however they can—including, perhaps, through America’s largest professional social network. (Pollack claims the request was an error.)
To Krevat, the LinkedIn request was almost funny, in the laugh-till-you-cry sense. She remembers thinking, Is this lady stalking me or does she really think we’d be good in each other’s professional networks? “It was just more evidence that I was in this bizarro world of receiving bills I shouldn’t be responsible for,” Krevat told me.
Krevat’s bills were just a drop in the American medical-debt ocean. About 43 million Americans have unpaid medical debt dinging their credit, and half of all overdue debt on Americans’ credit reports is from medical expenses, according to a Consumer Financial Protection Bureau study from 2014. The debt typically comes from out-of-network doctors who people thought were in-network, hospital stays, or ambulance rides. About one in six Americans received a surprise out-of-network medical bill in 2017 after being treated in a hospital, even though they had insurance, according to Kaiser Health News.
In an emailed statement, the American Hospital Association told me, “Hospitals and health systems treat all patients who come through their doors, around the clock and regardless of their ability to pay. They work closely with uninsured and low-income patients on their individual bills, including discussing financial-assistance options with them.”
Krevat’s bills began to arrive while she was still being treated at Columbia University Irving Medical Center. One came from one of the hospital’s doctors, Mathew R. Williams, for $9,000. Another came from a doctor named Aziz Ghaly for $17,418. A few months later, a separate invoice from Weill Cornell Physicians said she owed $22,464.
Williams, who now works for New York University Langone Health, told me over email that decisions about billing and insurance participation were made by Columbia University Irving Medical Center, not by individual providers. In an emailed statement, a representative from Columbia said, “Unfortunately, when a patient’s insurance plan does not cover all of the costs involved in their care, the patient is responsible for the balance. We understand that unusually high health-care costs may create a financial hardship for other patients and we try to set up payment arrangements that are within their financial means.” (Ghaly told me he was a fellow at Columbia at the time. “We are on salary, and they bill for us,” he said. “I have no idea what they bill, or why it was out of network. We’re not involved in it at all. This is an unfortunate part of our health system.”)
Krevat appealed to GHI, her insurer, saying the services should have been covered because she was unconscious when she received them. “I was never in a position to preselect who can perform my heart transplant,” she wrote in a letter she shared with The Atlantic. Seemingly at random, GHI would send her a check to cover some of the out-of-network expenses. But the insurer said she still owed the rest of the money.
Krevat started an Excel spreadsheet to track the insurance company’s payments. Despite her fatigue, she spent hours on the phone and took detailed notes on her conversations with various customer-service representatives. She wondered whether the debts would affect her credit score, or whether hospitals would start docking her husband’s wages. She rarely got the same representative twice. “Every time I made any of these phone calls, it was like I was some stranger telling the whole story from the very beginning, like I had never told anyone before,” she said.
The LinkedIn request was an extreme case, but Pollack was not the only collector who started coming after Krevat. Jeffrey G. Lerman, P.C., sent several letters attempting to collect nearly $15,000 for various Columbia University medical groups. Krevat says collectors called several times a week for more than a year. They sent so many letters that she eventually stopped checking the mail.
Companies can try to collect on medical debt virtually forever. Although old debt is easier to escape in court, little prevents debt collectors from trying to collect on it. “Debt never dies,” says Craig Antico, a former medical-debt collector and a co-founder of RIP Medical Debt, an organization that buys and eliminates medical debt. Only Wisconsin, North Carolina, and Mississippi clear certain debts once they are past the statute of limitations.
Generally, hospitals seeking to get bills paid place accounts in a “waterfall” of collection attempts, Antico told me. At first, hospitals, or the collections agencies they hire, will approach debtors with a “soft” collection: Did you misplace your bill? Maybe you qualify for charity care. “But then if people aren’t responding, it will get more stressful,” Antico said. A collection agency might report the amount owed to a credit bureau, or the account might be sent to an attorney to enforce collection. (A new proposed federal rule would prohibit debt collectors from calling more than seven times weekly about a debt, but consumer advocates told me this could still result in more than seven calls in a week, since each doctor’s bill can count as a separate debt.)
Eventually, collectors might opt to sue you, in which case they might be able to garnish your wages or put a lien on your property. Antico estimates, based on an ADP report, that about 1.5 percent of American employees have a garnishment on their wages for a medical reason.
Medical debt is unique among consumer debts in that it’s rarely taken on voluntarily—and sometimes not even when the debtor is conscious. The number of people drowning in medical debt varies from state to state, and depends in part on the uninsured rate. In Texas, where 17 percent of people are uninsured, more than a quarter of households have a medical debt that has been reported to collections agencies, higher than the national average. According to the Urban Institute, the median amount of medical debt owed nationally is $681—which is especially a problem for the nearly half of Americans who don’t have $400 on hand.
After trying to collect on their own behalf for a while, some hospitals and doctors’ offices sell their debt to debt buyers, who pay pennies for each dollar owed, then try their hardest to simply collect more than they paid. Why hospitals sell their debt is a matter of debate, but several consumer lawyers speculated that it’s because hospitals don’t want their good names associated with aggressive debt-collection tactics. They’d rather leave the intimidating calls to a more anonymous-sounding organization like Pendrick Capital Partners, one prominent medical-debt buyer. That way the hospital at least gets paid a small amount right away, instead of holding out for the full sum.
For former patients who owe money, Antico said, these debt buyers might be preferable to being hounded by the hospitals themselves, since the debt buyers have to collect only a fraction of the debt to make a profit.
The more times a debt changes hands, however, the more likely it is to contain errors. The Consumer Financial Protection Bureau’s database contains 267 complaints about Pendrick Capital Partners; the most frequent issue relates to “attempts to collect on a debt not owed.” “Pendrick Capital has been attempting to collect on an erroneous medical debt for at least a year now, despite multiple disputes to various bureaus and collection companies,” one Floridian wrote in 2018. “Each time I dispute the debt, the account is deleted by the collection company only to be replaced by another … The collection merry-go-round continues and my credit suffers.”
In one recent case in Maryland, Pendrick allegedly tried to collect on a debt from the wrong woman named Crystal Long. When Long called Pendrick’s debt collector to say she was not responsible for the debt—the birthday of the person who incurred the debt did not match hers—the debt collector allegedly responded, “You’ll have to dispute this with your credit bureau then,” according to court records. In another case, a debt collector hired by Pendrick allegedly called a woman more than 30 times in an attempt to collect $892 in medical debt, even though she had already filed for bankruptcy. (Pendrick and its lawyers did not return requests for comment.)
Jan Stieger, of the Receivables Management Association International, a trade group of debt buyers, called these instances “one-off” situations. I asked her if she thought hospitals might be selling their debt because collecting on medical debt could be seen as a morally icky thing to do. She said the extension of consumer debt should be considered a privilege, not a right. “The credit ecosystem works on the principle that legitimate debt should be repaid,” she said.
Krevat did not, in the end, repay the entire $50,000. Eventually, she told me, she negotiated down her debt with KP Recovery Solutions to $4,500, and she remembers paying Jeffrey Lerman a few hundred dollars as well. (Lerman did not respond to a request for comment.) She doesn’t recall whether she paid Weill Cornell Physicians anything. In an email, a Weill Cornell spokesperson told me, “After a review by the WCM [Weill Cornell Medicine] billing department, they determined that the patient may have been billed for approximately $4,000. However, since 2014 the institution no longer pursued that payment.” Krevat’s credit score ultimately was not affected.
Since Krevat’s ordeal, New York and eight other states have passed comprehensive laws protecting patients from surprise billing of the kind she experienced, and Congress is considering similar measures. EmblemHealth, the parent company of Krevat’s insurer, told me in an email that “beyond making changes to its internal policies and procedures, EmblemHealth and its leadership continue to work with Congress in order to ensure that cases like this 2010 instance would not be possible today.” Still, Krevat describes herself as being “totally traumatized.” She says she’s still too afraid to check the mail every day.
In 2012, nearly two years after her hospital stay, Krevat got another email from Karen Pollack, the collector who sent the LinkedIn request. A new $780 bill had come in for collections, this time for a doctor Krevat says she never saw. Krevat wrote back, “I will not pay for something that did not happen.” Krevat never paid it, and she never heard from Pollack again.