CHI Franciscan to pay millions following AG’s charity care lawsuit

On Monday, Attorney General Bob Ferguson announced a resolution requiring St. Joseph Medical Center in Tacoma, along with seven other CHI Franciscan hospitals, to pay $2.22 million in refunds, forgive as much as $20 million in medical debt, pay the AG’s office $2.46 million, and work to repair the credit of the thousands of qualified patients who did not receive charity care in these hospitals between 2012 and 2017.

The resolution comes nearly two years after Ferguson filed a lawsuit against St. Joseph for withholding charity care from tens of thousands of low-income patients.


Get the latest state-specific policy intelligence for the health care sector delivered to your inbox.


Washington state law requires all hospitals in the state to make charity care available for those at or below 200 percent of the federal poverty guidelines. Those with family incomes below 100 percent of the poverty guidelines are able to receive free medically necessary care, and those up to 200 percent can get a discount on their care.  

Washington’s charity care laws also require hospitals to screen patients for charity care eligibility, provide verbal and written notice of charity care availability, and require patients to provide only one document proving income.  

According to Ferguson’s lawsuit, St. Joseph violated all three of these requirements, dating back to at least 2012.

“St. Joseph undermined the purpose of the Charity Care Act… and violated the Washington Consumer Protection Act… by pressuring its low-income patients to pay for their treatment upfront while concealing the availability of charity care,” reads the lawsuit.

The lawsuit asserts that St. Joseph’s third-party onsite collection vender and agent, Conifer Health Solutions, utilized techniques pressuring patients to pay upfront and diminished their ability to explore charity care.

Conifer also trained their St. Joseph employees to “never volunteer information about its charity care program to patients and only provide charity care applications to patients who specifically requested one. But even when a patient requested a charity care application, Conifer trained its staff to attempt to collect a deposit from the patient before providing them with the charity care application.”

The lawsuit also asserts that leadership at St. Joseph knew about the issues with the hospital’s charity care program, but failed to correct it.

According to a statement announcing the lawsuit resolution, a third-party review has identified at least 5,451 charity care eligible patients who will receive $2.2 million in refunds.

There are an additional 7,000 uninsured patients that owe approximately $26 million from medical care received between 2012 and 2017. Those who were eligible for charity care during that time period will have their debt automatically forgiven.

In addition to the refunds and debt forgiveness outlined in the settlement, the resolution requires the hospitals to reform their charity care programs. Specifically, it requires St. Joseph to post charity care information on their websites and social media accounts, provide information on charity care applications through Tacoma-area media outlets, conduct education and outreach on financial assistance, and comply with state law.

The resolution also places a five-year injunction on the eight hospitals, requiring them to provide charity care for those up to 300 percent of the federal poverty guidelines. St. Joseph will also be required to provide detailed yearly reports to the State on details related to their charity care program.

“Medical debt is one of the leading reasons why families get trapped in poverty,” AG Ferguson said in a press release. “Hospitals are required to inform low-income patients about the availability of charity care. St. Joseph failed to live up to its duty, and imposed obstacles on vulnerable Washingtonians trying to access affordable care. Today’s resolution rights a wrong committed against thousands of patients across Washington.”

Editor’s Note: Since this article was published, a representative from Quinn Thomas (which handles public relations for CHI Franciscan) sent State of Reform a statement in response. Read that statement here