The attorney general amended a complaint in state court to include collection agencies working with hospital clients, shedding light on letter claims and state-specific laws on letters to consumers. ACA is working with its members on this case.
08/15/2022 2:15 P.M.
3 minute read
Washington Attorney General Bob Ferguson has amended a state court lawsuit alleging violations of the Washington State Collection Agency Act and Consumer Protection Act by 14 Providence Health & Services Hospitals to include two collection agencies working with patients on behalf of the hospitals.
The attorney general’s underlying consumer protection lawsuit stems from Providence’s charity care and collections practices with patients with medical debt, according to a news release from the attorney general’s office.
In February, The Seattle Times reported that the attorney general’s lawsuit alleged the hospitals did not provide charity care options to low-income patients.
This month, the lawsuit was amended to include the collection agencies, Harris & Harris and Optimum Outcomes, for allegedly failing to include required charity care disclosures in letters to consumers.
In a statement provided to ACA International, Harris & Harris General Counsel and Chief Legal Officer Aryeh Derman said:
“Harris & Harris (H&H) has proudly worked with Providence to collect on delinquent account receivables since 2019 and have been working cooperatively with our client to help them defend this matter. H&H fervently denies the attorney general’s allegation pertaining to the letter claims. Our office represents over 25 health care providers throughout the United States and is well versed at helping administer charity care programs for nearly all of them. H&H provided excellent service to Providence patients and will continue to do so. We are working with our outside counsel at Hinshaw & Culbertson and our industry trade groups to protect our interests and those of fellow collection agencies that lawfully operate in Washington state.”
Ferguson’s lawsuit, filed in King County Superior Court, alleges that the hospitals committed Consumer Protection Act violations, including:
- Training employees to collect payment without regard for a patient’s eligibility for financial assistance.
- Failing to notify patients they were eligible for charity care financial assistance when the providers determined they qualified for assistance.
Providence provided a statement to MedPage Today “that the allegations were not an accurate portrayal of the company’s efforts around financial assistance in the state.”
“We continue to believe strongly that the charges against the Providence family of organizations in Washington state are inaccurate and unfair,” a Providence spokesperson said. “Charity care and financial assistance are a central tenet of our mission as a not-for-profit organization. As the largest provider of charity care in the state of Washington, the Providence family of organizations provided $75.5 million in free and discounted care statewide in 2021 alone. We also absorbed $471 million in uncompensated Medicaid costs last year in Washington state. Our practices comply with, and in many instances exceed, the requirements of Washington’s Charity Care Act. In fact, our threshold for charity care eligibility is at least two times more generous than Washington state standards.”
The lawsuit seeks restitution in the form of full write-off of medical debts and refunds, plus interest, for patients who did not receive financial assistance. In addition to the $70 million in debt relief and refunds, Ferguson is also seeking millions of dollars in civil penalties.
This case centers on a state-specific law on their letters.
ACA’s quarterly Hot Topic series, State Specifics for Collectors, next scheduled for 2 p.m. CDT Aug. 18, will cover this topic in addition to a discussion to help trainers, compliance officers and collectors in the accounts receivable management industry gain a better understanding of the most important state “can and can nots” to remain compliant on every call, no matter the consumer’s location. Nicholas Prola, general counsel at Professional Finance Company Inc., Abigail Pressler, general counsel at NCB Management Services Inc., and Stefanie Jackman, partner at Troutman Pepper, are the featured speakers on the Hot Topic series. Click here to register.
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