New Jersey Settles with Medical Collection Agency

The New Jersey Office of the Attorney General, through its Division of Consumer Affairs, announced last week a settlement with accounts receivable management firms that were collecting on old accounts from a closed hospital.

A press announcement said that collection agency Rubin & Raine, Inc., located in Eatontown, and debt buyer International Portfolio, Inc. of Conshocken, Pa., who have admitted no wrongdoing in connection with the collection of the debts, have agreed to comply with the state's Consumer Fraud Act and Collections Agency Statute and federal Fair Debt Collection Practices Act (FDCPA) in their operations.

The collection agency also agreed to not purse any collection efforts of any Pascack Valley Hospital accounts receivable for which the statute of limitations expired on or before September 19, 2008. The company also agreed to use all reasonable efforts to verify the age, amount and accuracy of an accounts receivable before sending a collection notice.

According to local news site NorthJersey.com, more than 18,000 patient accounts from the old hospital – which closed in 2007 -- with a face value of more than $90 million, were purchased last year by International Portfolio in the hospital’s bankruptcy proceeding. The debt purchaser then outsourced the collection of the accounts to Rubin & Raine.

But consumers complained to the Division of Consumer Affairs that the some of the accounts were very old and had been paid by insurance or government programs. After receiving more than 60 complaints, the division began its investigation.

“This settlement addresses concerns raised by former patients about supposed balances that they owed to the hospital, some dating back many years,” Attorney General Anne Milgram said. “These companies must use reasonable efforts to confirm the amounts that are owed and to comply with applicable laws and regulations.”

The state did not allege any wrongdoing in the case.

An official at International Portfolio told NorthJersey.com that the accounts were still being worked and that it stand ready to assist consumers that run into problems.