Debt Collector Wants MN AG’s Lawsuit Thrown Out

Minnesota's attorney general, which sued Accretive Health for allegedly breaching privacy laws, has now accused the company of using aggressive-and sometimes illegal-methods for collecting money from Fairview hospital patients. The company says the allegations are inaccurate, and it is asking a judge to dismiss the lawsuit filed against it.

A debt collection agency accused of violating privacy laws and using overly aggressive tactics for obtaining funds from patients of Minneapolis-based Fairview Health Services said that the allegations are based on “unfounded speculation.”

And it's requesting that a lawsuit filed against it be thrown out.

Minnesota Attorney General Lori Swanson in January filed the lawsuit against Chicago-based Accretive Health, LLC, accusing the company of violating privacy laws after an Accretive corporate laptop, which was not encrypted and contained confidential data for roughly 23,000 Fairview and North Memorial Health Care patients, was stolen.

Accretive's request for dismissal of the lawsuit was filed Monday, about a week after Swanson issued a six-volume report including additional allegations against Accretive. The report claims that the company imposed quotas on hospital staff to collect money from patients-sometimes before treatment was provided. Accretive also allegedly encouraged competitions and prizes for obtaining funds, among other tactics “commonly utilized in high-pressure boiler-room-style sales atmospheres.”

Swanson alleges that Accretive may have broken state and federal laws regarding debt collection practices, and the company's “aggressive collections approach may constitute a threat to withhold medical treatment” that violated Minnesota law.

In a statement issued Sunday, Accretive fought back against Swanson's new report, stating that “the inaccuracies, innuendo, and unfounded speculation that have been part of the Minnesota attorney general's recent allegations are extensive.”

As an example of Swanson's “inaccuracies,” Accretive said that one allegation cited in the attorney general's report-which claimed that a father was approached for payment prior to his child being provided care-was incorrect, as a family member had requested financial consultation in advance of treatment, and “the father expressed his appreciation for our assistance.”

“Nevertheless, we take any patient's concerns seriously,” Accretive said. “One of our fundamental principles is that patients should never believe that the critical work we do has interfered with their access to care. We are committed to understanding and addressing any situation where a patient expresses concern.”

On Monday, Accretive filed a motion in U.S. District Court in Minnesota requesting the dismissal of Swanson's suit-which it says “includes allegations that are factually baseless and legally indefensible.”

“What is worse is that rather than litigate this case in the courtroom, the attorney general orchestrated a nationwide media campaign against Accretive Health,” the company said in a news release.

Accretive said Friday that Fairview had terminated its billing contract with the company.

In seeking dismissal of Swanson's lawsuit, Accretive claims that it cannot be held responsible for unforeseeable criminal activities such as the theft of a corporate laptop. The company also said that there is no evidence that any patient data was compromised as a result of the theft.

In addition, Accretive said that it received a consent order from the Minnesota Department of Commerce in February to “address its debt collection practices in Minnesota.” The company says it's cooperating with the Commerce Department-and “under fundamental principles of law, the attorney general is barred from pursuing the identical claims already addressed by a fellow state official.”

Last, Accretive said that information about the services it provided to Fairview were “widely disseminated to the public in securities filings and media accounts, defeating any fraud claim.”

Fairview said last week that it has cooperated with Swanson and continues to “evaluate issues raised by the Attorney General and will take action as appropriate,” according to a report by the Star Tribune.

On the heels of Swanson's scathing report released last week, several law firms announced that they have filed class-action lawsuits against Accretive on behalf of investors in the company, on the grounds that Accretive and its leaders violated securities laws by issuing false and misleading statements about the business-namely, by failing to disclose that it was violating state and federal laws as alleged by Swanson.

In a recent Star Tribune report, several patients described the aggressive tactics they encountered at Fairview hospitals. For example, one woman who went to Fairview Southdale's emergency room while experiencing pain from a kidney stone said that while waiting for a doctor, a man approached her bedside, told her that the visit would cost her between $750 and $800, and asked for her credit card.

“They are awful stories,” Mark Eustis, Fairview's president and CEO, told the Minneapolis newspaper. “We don't like to hear those stories, and we're sorry that people have been treated that way.”

To learn more about patients who have come forward in the wake of Swanson's report, read the full Start Tribune story here.