Wash. AG Amends Lawsuit to Accuse Collection Agencies of Failing to Provide Certain Disclosures

Months after filing a lawsuit accusing a hospital network of “aggressively” seeking to collect $70 million from individuals who were eligible for charity care, the Attorney General of Washington has expanded his lawsuit to include a pair of collection agencies that allegedly failed to inform individuals about their eligibility. The hospital network reportedly referred more than 54,000 accounts of low-income patients to third-party agencies, which had a total of $470 million in unpaid debts.

When collecting on behalf of their clients — Swedish Health Services and Providence Health & Services-Washington — the two agencies, Harris & Harris and Optimum Outcomes, allegedly violated Washington’s Collection Agency Act and Consumer Protection Act by failing to provide disclosures related to charity care and the individuals’ right to request certain information about the debt, according to the amended lawsuit. A copy of the amended lawsuit, filed in Washington state court, can be accessed by clicking here.

Optimum Outcomes was instructed by its client to provide information about charity care only if an individual asked for it, which violates state law, according to the suit. When sending an initial collection notice, agencies are required to include:

  • Written notice that an individual may be eligible for charity care;
  • Contact information for the hospital; and
  • Notice that the patient has the right to request the hospital account number assigned to the debt, date of last payment, and an itemized statement stating whether the patient was found eligible for charity care, and, if so, the amount due after all charity care has been applied.

“Families live in fear that an unexpected medical emergency could result in crushing medical debt,” said Bob Ferguson, Washington’s Attorney General, in a statement. “Collection agencies cannot deceive Washingtonians about their legal right to access medical financial assistance. I fought to expand our charity care law so more individuals can have access to affordable health care — I am going to fight to ensure those laws are honored.”

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