Missing from the story: Virginia was one of the "red" states that didn't expand Medicaid to the lower to middle class. This has two follow-on effects: a bunch of people didn't have insurance, and the federal government stopped shoveling cash to hospitals that provided treatment to people without insurance.

Apparently wage garnishment is allowed under Virginia law, as it is a "state institution" (the hospital system). That is what makes this story in particular unique. I anticipate something like this happening (or worse) in my state.