FISHERSVILLE – The day after Kaiser Health News released a report about UVA Health System’s aggressive methods to collect money from patients for unpaid medical bills, the hospital’s CEO announced she would be leaving and Gov. Ralph Northam, who oversees UVA's health board, said he was “absolutely concerned” about the hospital’s collections practices and vowed to make changes.

The report detailed thousands of lawsuits against patients who had their homes and farms taken and paychecks seized, which destroyed their lives personally and financially.

What about Augusta Health?

What happens to patients who can't afford their medical bills at Augusta Health? 

"We do not garnish wages for medical bills," said Lisa Schwenk, director of public relations at Augusta Health. "We do not seize houses and stopped placing liens on property more than five years ago."

If Augusta Health patients need help and qualify, the hospital provides financial assistance, said Schwenk. While policies vary by hospital, there is no upper limit at which they stop providing financial assistance if a patient is in need and meets their charity care policy. 

The hospital provided $9,212,000 in financial assistance per their latest community benefit report published in 2017. This amount is based upon how much it costs Augusta Health to provide the services. The hospital also absorbed a $6,747,800 Medicaid shortfall. 

"Augusta Health is not fully reimbursed by the state for the full cost of Medicaid patients as some other hospitals are, and this difference is known as a Medicaid Shortfall," explained Schwenk. 

The hospital provides free or discounted care to patients in need of emergency or medically necessary treatment who have a household income below 400% of the federal poverty level guidelines. 

"All other uninsured patients will not be charged more than the amount generally billed to commercially insured patients for emergency or medically necessary care," said Schwenk.  

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Uninsured patients who have a higher income than 400% FPL receive a discount of 50% off charges for Augusta Health services and 35% off charges for AMG services to ensure they don't pay more for care than commercially insured individuals.

"Additionally, for catastrophic services we place a cap on how much payment is to be expected from the patient," said Schwenk.

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What is catastrophic? What is the cap?

A procedure done at Augusta Health is deemed catastrophic when it is higher than 25% of a person's annual income.

"If the amount is greater than 25% of the patient's annual income; this 25% of annual income is also the cap on the charges," said Schwenk.

The situation doesn't happen very often, said Schwenk, since insurance, financial assistance and non-insured discounts usually bring the balance under 25%. 

"But in the unlikely situation those deductions do not, the amount is further reduced to the catastrophic cap," said Schwenk. 

After the cap is determined, the hospital sets up a payment plan with interest as low as 0% for the patient. The plan itself may be set up for more than 12 months.

Financial assistance

Patients are encouraged to set up payment plans and apply for financial assistance if they need it, and Augusta Health has financial counselors available.

Once financial assistance is approved, Augusta Health performs a 240-day look back and forgives any balances owed 240 days prior to the date of application. They also extend a 10% discount for patients who pay their balances promptly. 

"The hospital does consider liquid assets (such as cash in the bank) greater than $15,000," said Schwenk. 

If a patient has cash in excess of $15,000, that should be applied to the debt first before the balance eligible for financial assistance is calculated, Schwenk further explained.  

"However, Augusta Health does not view important life savings such as retirement funds and real estate equity as liquid assets, and therefore we do not pursue these assets," said Schwenk. "Also excluded are financial savings (like a mutual fund or unmetered CD) that have a penalty if you cash them out." 


A patient will receive a statement every 30 days from Augusta Health for three months. The fourth statement, at 100 days after the first bill, lets the patient know it is the final statement from Augusta Health.

If the patient doesn't pay the bill in full, apply for financial assistance or set up a payment plan, the account will then be forwarded to a collection agency. 

"For a period of time, the collection agency will work with the patient, but without credit reporting," said Schwenk. "Later, if still no payment, the collection agency will submit a credit report."

All charges, billing practices, charity care plans and financial assistance policies are overseen by a community-based board at Augusta Health.

"We understand the cost of health care can represent an overwhelming situation for patients in our community," said Schwenk. "We work very diligently to have sound billing and business processes; however, as a community hospital, we must be compassionate."

Known as bad debt, if an amount owed still goes unpaid, at some point Augusta Health will absorb the cost of care without any offsetting revenue. After which, the case is closed and no further collection efforts are pursued. 

Schwenk noted that in rare circumstances, an insurance company will send payment directly to a patient with instructions to submit payment to Augusta Health. Sometimes, a patient keeps the money instead of using it for the medical bill.

"In these instances, we may use legal efforts to collect the amount that the patient received from the insurance company, but failed to pay to Augusta Health," said Schwenk.

These cases are reviewed by the hospital's board for guidance on collection process. 

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