Accretive Says It’s Working to Address Minnesota Concern

Accretive Health Inc. (AH), a hospital billings-collection company, said it’s working with advisers to address concerns raised by the Minnesota attorney general’s office that it puts bedside pressure on patients to pay bills.

The claims “grossly distort and mischaracterize” its revenue cycle services, the company said yesterday in a statement. The suggestion Accretive puts bedside pressure on patients to pay their bills out of pocket are a “flagrant distortion of fact,” the company said.

Accretive shares tumbled by the most ever on April 25, just after Minnesota Attorney General Lori Swanson issued a report alleging Accretive violated U.S. and state patient-privacy and debt-collection laws. She said patients at Fairview Health Services, a Minnesota hospital chain, were pressured for payment before they received care in some cases and that Accretive’s debt collectors didn’t properly disclose their role. Swanson filed a lawsuit on Jan. 19 against Accretive.

Chicago-based Accretive said in yesterday’s statement it doesn’t deny access to patient care and the allegation is “flatly untrue.”

Swanson said last week employees at Fairview, a nonprofit chain of seven hospitals based in Minneapolis, were required to use a computer system derisively called “Blue Balls” to track whether patients paid their bills. The payment system began after Fairview hired Accretive in May 2010, Swanson said in her report describing the companies’ relationship.

Credit Scores

Actions that Accretive used at Fairview included issuing emergency room employees “scripts” for conversations with patients that “can lead a patient or her family to believe the patient will not receive treatment until payment is made,” Swanson said.

Employees were instructed to ask for credit card payments, tell patients they’d wait for them to retrieve their checkbooks from their cars, or if the patients said they couldn’t pay, remind them that debt-collection activities “can affect your credit score,” according to the scripts.

Accretive said late on April 27 that Fairview had canceled its contract with them, adding it didn’t know yet how the cancellation would affect its business. Accretive said it would provide an update on its May 9 quarterly financial call.

Earlier that same day, Representative Pete Stark, a California Democrat, asked U.S. health officials to investigate Accretive’s practices.

Federal law prohibits hospitals from denying emergency care to anyone, regardless of their ability to pay.

Shares of Accretive Health fell $1.17 to $9.33 in New York trading on April 27. The stock is down 59 percent year to date.

To contact the reporter on this story: Dan Hart in Washington at dahart@bloomberg.net

To contact the editor responsible for this story: Sylvia Wier at swier@bloomberg.net.

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