The Minnesota Attorney General’s scathing report into collection practices by Accretive Health may have attracted the attention of the federal U.S. Health and Human Services Department.
Last week Health and Human Services Secretary Kathleen Sebelius said that her department was “looking into” allegations of collections contractors confronting patients in a “hospital setting,” although she did not say that her office was specifically investigating Accretive Health, which was recently the subject of a high-profile and highly publicized report by the Minnesota Attorney General.
Accretive Health has denied those claims, but according to Jeffrey Young of the Huffington Post, the Attorney General’s actions not only may have attracted the attention of the feds, but certainly of Congress.
Leading Democrats on the House Committee on Energy and Commerce are seeking answers from Accretive about its practices. Reps. Henry Waxman (Calif.), Diana DeGette (Colo.) and G.K. Butterfield (N.C.), sent the letter to Accretive CEO Mary Tolan asking she attend a private briefing last Friday. It is not known whether or not representatives of Accretive attended that meeting.
Accretive has delayed responding to other members of Congress. On the Senate side, Al Franken (Minn.) and Pete Stark (Calif.) has similarly sought answers from Accretive. At Wednesday’s quarterly call with analysts, CEO Tolan has promised to respond. An Accretive spokesperson, Gary Rubin, told insideARM.com that the company met with members of Franken’s staff last week.
Tolan also promised a full and detailed response to the Minnesota Attorney General’s report Friday.
In January, Minnesota Attorney General Lori Swanson sued Accretive for violating patient privacy after one of the company’s employees had a laptop stolen containing detailed information on patients of the company’s biggest client, Fairview Health Services of Minnesota. The suit did not affect the company’s bottom line, as Accretive reported profits jumped in the first quarter of 2012 from $200,000 one year ago to $1.5 million on revenues of $253.7 million.
In April, the second shoe from Minnesota Attorney General’s office fell – more of a steel-toed boot – in the form of a six-volume report castigating Accretive’s collection practices at Fairview. The AG claimed, among many charges, that the company engaged in egregious and excessive collections practices, such as collecting patients at bedside. Accretive denied these claims, and even though the report was just that – a report that carried no criminal or civil litigation against the company — it rocked shareholder confidence and its stock price fell by half in the aftermath of the report.
Earlier this week, Chicago mayor — and former White House Chief of Staff — Rahm Emanuel came to Accretive’s defense by urging Swanson to “cease efforts to publicly prosecute” the case in the press. Emanuel noted that the Chicago-based firm “does important things for hospitals and good things for our city, particularly for our neediest citizens.”
In Wednesday’s call Tolan announced that the company has lowered its earnings estimate for 2012 by more than 20 percent.