Collecting Legitimate Fees No Crime

If you practice health care in Minnesota, apparently you are a villain if you attempt to collect a fee for service in advance, at least in the eyes of the attorney general.

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Last week Minnesota Attorney General Lori Swanson issued a scathing compliance review of Minneapolis-based Fairview Health Services, a not-for-profit chain of seven hospitals and more than 40 clinics, and its contractual relationship with Chicago-based Accretive Health, a publicly traded firm offering revenue cycle management services for hospitals.

Fairview hired Chicago-based Accretive to overhaul its revenue cycle business processes, including taking steps to increase patient revenues, which prompted the Attorney General review. The six-volume report castigates Accretive for what it describes as overly aggressive practices to compel patients to pay hospital fees in advance. Accretive denies all the claims by the AG.

What is troubling is that some of the procedures it implemented at Fairview, though criticized by the AG, are considered best practices by health care organizations across the country.

Of course, AG Lori Swanson is a political animal, one seeking votes. And as a recent survey by the CDC demonstrated, one in five of her constituents either owes or has owed money to a hospital. For Swanson it’s a brilliant move, employing her bully pulpit to infect the jury pool and whip up popular support. But such inflammatory rhetoric is irresponsible, and may have a chilling effect, one that will hit economic well being of the state’s health care industry.

The attorney general was especially critical of software that Accretive provided admissions staff, which contained scripts designed to increase the likelihood of patients making payment for services up front and also make the patient aware of their fiduciary responsibility. According to the AG’s report, a Fairview staff survey “indicated” that 40 percent of Fairview staff “were uncomfortable with the collection activity.” No one “likes” asking people for money, and people employed in the health care industry may very well be less inclined to do so than other businesses. Having a software system that made less than half of employees “uncomfortable” with performing a task that most human beings find distasteful does not seem a compelling argument for condemnation.

Accretive provided admissions staff with patient scoring tools to know with relative accuracy how much a patient will be out of pocket for treatment, and would request that payment upon admission. This AG also apparently finds disfavor with the practice.

The AG’s report, incidentally, carries with it no legal action or penalties. Swanson’s office is bringing Accretive into court, however, for violating Minnesota’s medical privacy laws after an employee of the collection agency lost a laptop containing sensitive information on 23,500 Minnesotans who had received healthcare services from Fairview and other medical institutions. Accretive has denied those charges on grounds that it cannot be held responsible for data that was stolen, especially as there has been no evidence the data was compromised (If that is Accretive’s defense, may we respectfully request that it investigate the recent resolution agreement by BlueCross BlueShield of Tennessee?).

While Accretive’s policies and procedures implemented at Fairview may very well have been excessive, the AG’s report goes too far to condemn actions that are practiced by responsible health care organizations. Collecting appropriate fees is not a crime. It is, in fact, normal course of any business – including health care.