The Roanoke Times

File 2009 While a patient lay hospitalized in Carilion Roanoke Memorial Hospital, the company prepared a lawsuit against her for her bill of more than $350,000. Carilion has since dropped the lawsuit.

As Elaine Harnsberger lay ill in a hospital bed, officials at Carilion Clinic were drafting a lawsuit to collect more than $350,000 she has accumulated in medical bills since March.

The lawsuit was served on Harnsberger on Aug. 9 -- while she was still a patient at Carilion Roanoke Memorial Hospital.

Carilion and other health care systems have long had a practice of suing some former patients for unpaid bills. But it's unusual for a provider to take legal action against someone still under its care.

"This is just unbelievable," said Pat Palmer, the founder of Medical Billing Advocates of America, a Salem-based company that assists patients with billing disputes.

After being asked about the case late Wednesday by The Roanoke Times, Carilion officials filed a motion Thursday to have the lawsuit dismissed.

"It is not our practice to serve patients with any type of collection notice while they are still hospitalized," Carilion spokesman Eric Earnhart wrote in an e-mail. "This was a unique situation, and unfortunately I am unable to provide you with additional details. The purpose of the suit was to find additional information -- it has since been withdrawn."

Harnsberger, who remains a patient at Roanoke Memorial, declined to comment Wednesday when reached by telephone in her hospital room.

The 60-year-old Roanoke County woman was admitted March 31 to Roanoke Memorial with "serious medical problems," according to Carilion's lawsuit. Through July 27, she had run up a bill of $359,158.50 -- of which she had paid nothing, the suit said.

In a letter to the Roanoke Circuit Court clerk that accompanied the lawsuit, Carilion attorney Robert Manetta wrote: "Please have the Sheriff serve Ms. Harnsberger at Carilion Roanoke Memorial Hospital."

With Harnsberger not talking and Carilion offering limited information, it was unclear whether the woman had insurance or was able to pay the bill herself.

Nonetheless, filing a lawsuit against someone still in the hospital makes it difficult for the patient to question the bill or obtain legal assistance, Palmer said.

"There's no way she can do that while she's still in the hospital," Palmer said. "To me, they would have to allow her time, once she's discharged, to review the bill and determine if she has any questions."

Harnsberger had not filed an answer to the lawsuit by the time a judge granted Carilion's motion to dismiss the case Thursday. Had she not responded within 21 days of being served, a default judgment against her would likely have been entered. The judgment would have given Carilion leverage to obtain her assets or wages.

Carilion -- a nonprofit organization and the largest employer in the Roanoke Valley -- spends millions every year on free or discounted treatment to patients who qualify under its charity care policy.

At the same time, critics say the health care system can be heavy-handed collecting debts.

Carilion obtained about 33,000 judgments in Roanoke's small claims court from between 2003 and mid-2008, according to a computer analysis of court records. That accounted for 40 percent of the court's caseload, putting the nonprofit far ahead of any landlord, bank or other business that sued for unpaid bills.

Carilion said it takes legal action only against the delinquent patients who it believes are able to pay their bills. But officials also say that when patients fail to give them information about their financial resources, as often happens, they sometimes have no option but to sue.

That can lead to judgments against the poor for bills they cannot pay. In 2008, a house painter who could not afford a car or a telephone recounted how Carilion garnished his wages to satisfy a judgment against him for unpaid bills of about $2,000.

Carilion refunded the amount when asked about the case, but said the former patient never submitted information that would have qualified him for charity care -- an assertion he disputed.

Since then, Carilion has cut back on the number of judgments filed while increasing the amount it spends on charity care. Last year, Carilion reported spending more than $51 million treating the indigent, part of its mission as a nonprofit, tax-exempt organization.

Carilion has filed 3,040 lawsuits this year seeking unpaid bills in its coverage area, which includes eight hospitals in Southwest Virginia. In 2008, the health care system filed 10,690 lawsuits from January through September.

Earnhart declined to comment when asked if Harnsberger qualified for financial assistance.

According to real estate records, she does not own the home listed by Carilion as her address, a single-story ranch that was assessed this year at $74,900.

Interviews with neighbors and family members produced little information about Harnsberger, who reportedly kept to herself and a large number of cats in her care.

And while Harnsberger is no longer facing a lawsuit from Carilion, it remains unclear what will happen with her $359,000 bill. In court papers, Carilion asked that the case be dismissed without prejudice -- reserving its right to bring a similar legal action in the future.