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Salary: $52,000. Debt: $55,000

Jan 13, 2009

The 39-year-old IT worker panicked when she opened the bill from Baltimore's Mercy Medical Center and saw the tab for her two-week stay: $39,440.44 for emergency gynecological surgery and subsequent treatment of a blood clot and other serious complications. More than $16,000 in charges from physicians and others arrived later, she said. Her medical bills for the September 2007 hospitalization, she added, exceeded her $52,000 annual income.

More than a year later, the woman says she is still so upset and embarrassed by her debt that she would not allow her name to be used for this story.

"I have a lot of anxiety about this, and I have trouble dealing with it," she said last week.

At the time of her illness, the woman had just started a new job. As a contract employee, she was not covered by the company's health insurance and was not paid for her six-week absence from work. She owed mortgage and car payments, was spending $150 a month to settle an old medical debt and carried a $2,000 balance on a maxed-out credit card. Her utility bill was chronically in arrears, and she was worried that her home might be forced into foreclosure. A lawyer she consulted advised that she consider filing for bankruptcy.

Because her income was too high to qualify for charity care, she did what consumer advocates recommend: She tried to negotiate directly with Mercy. Hospitals typically charge uninsured patients full price for care, which can be as much as five times higher than rates negotiated by insurance programs.

She was offered a 20 percent discount and a $675-per-month payment schedule.

"I told them if I had that much discretionary income, I wouldn't have credit card debt," she recalled, countering with an offer of $150, which the hospital rejected. "It felt like I was up against Goliath."

Searching online for help, she found The Access Project, a Boston-based research and advocacy group affiliated with Brandeis University. Andrew Cohen, who directs the group's Medical Debt Resolution Program, advised her to write a letter saying that she appreciated her care and wanted to pay "a fair and reasonable price."

In her April 30 letter to Mercy's chief financial officer, John Topper, the woman wrote that although she now had health insurance, she was "literally living paycheck to paycheck" and had not turned on her furnace the previous winter, relying on her oven for heat. At Cohen's suggestion, she sent copies to Maryland Attorney General Douglas F. Gansler and Sen. Charles Grassley. The Iowa Republican is an influential critic of what he regards as inadequate charity care provided by the nation's nonprofit hospitals, which receive an estimated $50 billion annually in tax breaks and other payments.

On May 8 Mercy's collections manager wrote back, saying that although the hospital had "taken all steps necessary to assist" her, it would cut her bill in half, leaving a balance of $19,720.22, and would negotiate an interest-free "payment arrangement that works for you." She has been making $100 monthly payments.

Mercy spokesman Daniel Collins said that the hospital provided about $40 million in uncompensated care in 2008 and "continues to work with patients to provide them with affordable, top-quality care."

"She did everything right, and she did end up with a decent outcome," Cohen said, "but the issue is her long-term financial stability."

The woman says she feels lucky that her bill was halved but overwhelmed by medical debt. "I can't save any money," she said. "I feel like I'll never see the end of it."

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