May 3 (Bloomberg) -- An Accretive Health Inc. lawyer claimed Minnesota Attorney General Lori Swanson negotiated in bad faith before suing the company in January and disclosed its confidential data in an April 24 report.
Accretive shares fell almost 42 percent one day after Swanson issued her six-part report critical of the Chicago-based company’s collections practices. Her federal lawsuit accused Accretive of breaching patient privacy laws.
The company on April 30 asked U.S. District Judge Richard H. Kyle in St. Paul, Minnesota, to dismiss the case, calling it “factually baseless and legally indefensible.”
“The AG’s office ignored its responsibility to get the facts straight,” outside counsel Andrew B. Clubok, a partner in the Chicago-based law firm Kirkland & Ellis LLP said in his seven-page letter yesterday.
Clubok alleged that his client only provided data he said was relied upon by Swanson in her April 24 report, “in order to explore a good-faith resolution” to the lawsuit.
In her initial and amended federal court complaints, Swanson challenged the company’s work for Minnesota-based Fairview Health Services and North Memorial Health Care.
In her subsequent report, she alleged that Accretive improperly posted debt collectors in hospital emergency rooms and patient bedsides.
Clubok said his client rejected Swanson’s insinuation that it was an “uber debt collector,” using a German word that translates to “super,” when individual collections comprise less than 10 percent of Accretive’s business.
He also accused Swanson of pressuring Accretive and Fairview to end it their “revenue cycle agreement.” Accretive said on April 27 that the seven-hospital chain did.
“Needless to say, it was troubling that the Attorney General’s office would personally pressure parties to a private contract to terminate the contract,” Clubok said.
Ryan Davenport, a Fairview spokesman, said company officials hadn’t yet seen the Accretive attorney’s letter and couldn’t comment on it. Fairview’s headquarters are in Minneapolis.
Fairview employees were required to use a computer system derisively called “Blue Balls” to track whether patients paid their bills, Swanson said last week. That payment system began after Fairview hired Accretive in May 2010.
‘Accurate and Documented’
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 scripts Swanson said Accretive issued to Fairview personnel.
Benjamin Wogsland, a spokesman for Swanson, said in a statement that the attorney general’s report -- formally called a compliance review -- is “accurate and documented by the facts.” Accretive’s emergency room and bedside collections practices were related by hospital patients, he said.
“There is an old saying among lawyers,” Wogsland said, “‘If the facts aren’t on your side, talk about the law. If the law’s not on your side, talk about the facts. And if you don’t have either on your side, pound the table and blame someone else.’ That’s what’s going on here.”
The attorney general’s case is State of Minnesota v. Accretive Health Inc., 12-cv-00145, U.S. District Court for Minnesota (St. Paul).
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