Nurses win $1.5 million settlement over hospital training debt scheme

SAN FRANCISCO (CN) — California Attorney General Rob Bonta announced Thursday that nurses employed by the largest hospital system in the country will no longer be required to pay back thousands in training costs if they leave their positions before completing a two-year service period.

The policy change for HCA Healthcare, which operates more than 180 hospitals in 20 states, is part of a more than $1.5 million settlement with the health care company, resolving claims arising from an investigation launched in partnership with the attorneys general of Colorado and Nevada and the Biden administration’s Consumer Financial Protection Bureau.

The investigation found that HCA violated California employment and consumer protection laws, as well as the federal consumer financial protection laws, by requiring hired nurses to sign a training repayment agreement provision as part of their employment contract.

“This is a form of employer-driven debt, a concerning practice across industries, where workers are handed bills simply for deciding to leave their jobs,” Bonta said in a press conference announcing the settlement.

“That’s not how we treat workers. In California, under state law, employers can’t saddle their workers with debt just because they choose to move on,” he added.

According to the attorney general’s office, newly hired nurses at HCA hospitals were required to complete the Specialty Training Apprenticeship for Registered Nurses Residency Program, a company-run training program, and sign the agreement provision.

The provision required nurses to repay a portion of the training cost— an average of $10,000 — if they did not commit to working for HCA for two years. If a nurse decided to leave HCA or was fired before the end of the two years, their loan was sent to collections.

Monique Hernandez, a nurse at Riverside Community Hospital and vice president of SEIU 121RN, said that HCA’s business model was “focused on cutting corners to squeeze as much profit as possible.”

“The StaRN program, which trapped new nurses under unfair and illegal debt obligation, was another example of HCA’s willingness to sacrifice nurses’ well-being in the quest for profit,” she said.

A survey by the California Nurses Association found that an estimated 40% of new nurses across the country have had to sign the provision, with a one-third saying that they felt “restrained from complaining about unsafe staffing or other unsafe working conditions,” according to John Pasha, a cardiovascular intensive care nurse and member of the California Nurses Association.

“TRAPs allowed employers to use the threat of financial ruin to prevent nurses from acting collectively to improve hospital working conditions for ourselves and our patients,” he said. “In short, these stay-for-pay contracts handcuff us to employers that exploit our calling as nurses to care for others.”

Along with being prohibited from enforcing the provision and collecting its debt, HCA will also have to pay around $83,000 in restitution to California nurses who already made payments on their debt and more than $1 million in penalties to the state.

In total, HCA will pay $2.9 million in penalties between settlements in California, Colorado and Nevada.

“This is real relief for workers and a serious warning to other employers. If you’re using illegal contracts to trap your workers, we will come for you,” Bonta said.

The attorney general’s office sued HCA on July 24, 2025, in Santa Clara Superior Court and is planning to file the proposed judgment as part of its settlement with HCA shortly, according to the office. The proposed judgment will then be subject to approval by the court.

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