Court Rules
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SettlementHigh Risk

Minnesota AG Secures Up to $1.4M in Medical-Debt Relief from Stevens Community Medical Center for Improper Uninsured Billing Discounts

Stevens Community Medical CenterAugust 10, 2026Minnesota Attorney General

Penalty Amount

$1,412,776

Consumers Affected

3,478

Summary

Minnesota Attorney General Keith Ellison reached a settlement with Stevens Community Medical Center (SCMC) over allegations that SCMC improperly calculated discounts required for uninsured patients with household incomes under $125,000, violating the Minnesota Hospital Agreement and state law. As a result, some uninsured patients were billed up to 20.5% more than allowed. SCMC must provide up to $1,412,776.25 in refunds or medical-debt reductions to potentially eligible patients.

Remedy

SCMC must notify 3,478 patients who received services from April 1, 2020 to December 31, 2025 of a potential additional discount in the form of a refund or reduction in outstanding medical debt. If patients verify household income was under $125,000 at the time of services, SCMC must provide the refund or debt adjustment based on the correct discount calculation.

Consumer RefundsCorrective Notice

Contract Impact

In-house legal teams at healthcare providers and hospitals should review vendor agreements with billing and revenue cycle management companies, third-party collection agencies, and payment plan administrators to ensure compliance with state uninsured billing laws and regulatory agreements such as the Minnesota Hospital Agreement. Specifically, they should examine clauses related to discount calculation methodologies (e.g., 'most favored insurer' provisions), charity care and financial assistance policies, and prohibitions on aggressive debt collection. They should also verify that their contracts require vendors to flag and prevent overbilling of uninsured patients, and include indemnification and audit rights for billing errors. Additionally, any payer contracts should be reviewed to determine the 'highest discount provided to any private insurer' for purposes of calculating uninsured discounts under Minn. Stat. § 144.589.

Contract Search Terms

most favored insureruninsured patient discountcharity care policyMinnesota Hospital Agreementmedical debt collection practicespayment plan termsbilling accuracy clauseindigent care obligationsprice transparencyoverbilling indemnification

Laws Cited

Minnesota Hospital AgreementMinn. Stat. § 144.589
Minn. Stat. § 144.589

Violation Types

Entity Details

Entity

Stevens Community Medical Center

Industry

Healthcare

Official Sources

Source Evidence

Entity Name
"Stevens Community Medical Center (SCMC) of Morris, Minnesota"
Fine Amount
"up to $1,412,776.25 in refunds or reductions in medical debt"
Laws Cited
"Minn. Stat. § 144.589"
Violation Types
"SCMC improperly calculated the discount it was required to provide to uninsured patients with household incomes under $125,000"
Consumers Affected
"notify 3,478 patients"
Event Date
"August 10, 2026"

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