CHI Franciscan, a health system operating eight hospitals in Washington state, agreed in April 2019 to provide up to $25 million in restitution to patients it failed to offer charity care between 2012 and 2017. The Washington State Attorney General sued the system after finding that St.
Joseph Medical Center in Tacoma and its sister hospitals violated Washington's consumer protection law by making financial assistance inaccessible to thousands of low-income patients who qualified for it. The settlement requires direct refunds to identified patients, forgiveness of millions in medical debt, and credit repair for those harmed by unpaid hospital bills. Affected patients—including those with and without insurance who received care during the five-year violation period—are eligible for relief without having to prove their case again.
Table of Contents
- What Violated Charity Care Law
- Who Qualifies for Relief
- Forms of Relief Beyond Cash Refunds
- What Patients Need to Know About Deadlines and Next Steps
- Systemic Changes Required at CHI Franciscan
- Frequently Asked Questions
What Violated Charity Care Law
Washington state requires hospitals to clearly disclose charity care eligibility and make it easy for uninsured or low-income patients to apply. CHI Franciscan failed to do this, leaving patients with substantial bills they did not know they could have had reduced or eliminated.
The Attorney General's investigation found the practice was systemic across the eight-hospital system rather than an isolated error at one facility. The lawsuit covered care provided between January 1, 2012, and December 31, 2017—a five-year window during which both insured and uninsured patients were denied charity care access. St. Joseph Medical Center in Tacoma was the primary defendant, but the settlement applied to all acute care hospitals operated by CHI Franciscan's parent company during that period.
Who Qualifies for Relief
Two groups of patients are eligible. At least 5,451 patients have been identified automatically for refunds totaling $2.22 million because their records clearly showed they qualified for charity care but never received it. These patients will receive refunds without having to apply—the settlement administrator will locate and contact them. A second group of approximately 7,000 uninsured patients who were treated at CHI Franciscan hospitals during the violation period are eligible for a debt-forgiveness review, with up to $20 million in medical debt subject to forgiveness.
A third-party reviewer will screen these patients for charity-care eligibility. If you received care at a CHI Franciscan hospital between 2012 and 2017 and believe you qualified for charity care, you should watch for contact from the settlement administrator or contact the Washington Attorney General's office for information on how to participate.
Forms of Relief Beyond Cash Refunds
The settlement includes three separate forms of aid. Direct refunds go to patients who clearly qualified but were denied. Debt forgiveness covers up to $20 million in medical bills for patients whose eligibility is confirmed through the review process. Additionally, CHI Franciscan agreed to rehabilitate the credit records of affected patients, removing or disputing negative marks that resulted from unpaid hospital debt. This repair process is managed by the settlement administrator and can help restore a patient's credit score without requiring the patient to pay the medical bill.
What Patients Need to Know About Deadlines and Next Steps
If you received an automatic refund notification, no action is required—the settlement administrator will process your payment. If you believe you are part of the 7,000-patient debt-forgiveness group and have not been contacted, reach out to the Washington State Attorney General's office or watch for communications from the settlement administrator. The debt-forgiveness review and credit repair process can take months to complete.
Keep records of any bills you received from CHI Franciscan hospitals during the 2012–2017 period, along with proof of income or other documentation of your financial situation at the time of treatment. This will help if you need to demonstrate that you qualified for charity care under Washington law.
Systemic Changes Required at CHI Franciscan
The settlement requires CHI Franciscan to implement systemwide reforms across all eight hospitals to change how charity care is offered and promoted. The health system committed to community outreach conducted with five Washington community organizations and Spanish-language outreach to ensure future patients know how to apply for financial assistance. These reforms are intended to prevent the same violations from recurring at the hospital system.
Frequently Asked Questions
Do I have to pay back the refund or debt forgiveness?
No. Refunds and debt forgiveness are a form of restitution ordered by the court and require no repayment.
Will the credit repair affect my credit score immediately?
Credit repair takes time as negative marks are disputed and removed. The settlement administrator manages this process, and you will be notified of progress.
What if I don't remember whether I qualified for charity care?
The third-party reviewer will assess your eligibility based on your income at the time of treatment. Contact the settlement administrator or the Washington Attorney General's office if you believe you were treated during the qualifying period.