BEND — A Bend woman has filed a class-action lawsuit after St. Charles Health System hired bill collectors to collect what she owes, rather than checking to see if she qualified for state-mandated charity care.

Oregon has financial assistance laws that require health care organizations to help low-income patients.

In the lawsuit, Kristine Reiger maintained that St. Charles Bend sent her a bill for $3,400 for her treatment following a car accident in 2022. In the lawsuit, Reiger said she contacted St. Charles multiple times seeking a payment plan, but was unable to reach anyone at the health system.

The health system did not tell her about its charity care payment program, according to the lawsuit. Instead the hospital sent her to a bill collector, who added $1,200 to the bill for fees and costs, according to the lawsuit.

The patient was served with a small-claims debt collection lawsuit in April 2023. Reiger was eligible for assistance, as her income was $25,240 in 2022, according to the lawsuit.

“Oregon law protects low and moderate income Oregonians from devastating medical bills,” said David Sugarman, one of the attorneys filing the lawsuit. “St. Charles has been ignoring Oregon law and illegally sending people to collection. We filed this lawsuit to return illegally collected monies and to make sure that St. Charles and its debt collector, Ray Klein, comply with Oregon law.”

Ray Klein Inc. is also named in the lawsuit, which was brought by Reiger for herself and on behalf of others who may be in the same situation.

The health system has not received a copy of the lawsuit, said Kayley Mendenhall, St. Charles Health System spokeswoman. The health system each year provides about $120 million in unreimbursed care to Central Oregon patients, she said.

“We regularly review our financial assistance policies and processes and believe we are in compliance with regulations,” Mendenhall said. “Our teams work incredibly hard to make sure patients understand the financial assistance that is available to them.”

Medical debt is a growing problem in the United States. A KFF and National Public Radio survey in 2022 showed that 1 in 5 American adults are on some kind of payment plan to a provider to pay off medical bills. Similarly in 2021, 23% of U.S. adults had one or more unpaid and past due bills from a medical service provider, according to the survey by KFF, formerly known as The Kaiser Family Foundation.

In Oregon, $390 million is owed in medical debt, according to the lawsuit.

Oregon lawmakers approved a law in 2019 that requires hospitals to provide financial assistance and tell patients with incomes up to 400% of the federal poverty level that charity care payments can be made on their behalf depending on the household income.

St. Charles, which is the region’s only hospital system, employs more than 4,500 people and is a nonprofit. It is required by law, according to the lawsuit, to make all efforts to collect the amount owed before sending the bill to a collection agency. It sent Reiger’s bill to Ray Klein Inc., a debt collection agency, according to the lawsuit.

The attorneys who filed the lawsuit believe there are hundreds of patients in a similar financial place as Reiger. The lawsuit is seeking actual damages, punitive damages and attorney’s fees and costs and is seeking a jury trial.

St. Charles is the latest regional hospital to face a lawsuit over its charity care policies.

Earlier this month, Providence hospitals in Washington agreed to provide nearly 100,000 low-income patients with about $158 million in refunds and debt relief, almost two years after being sued for allegedly violating that state’s charity care law, according to the Seattle Times.