07/02/2012 11:08 am ET

Shareholder Sues Accretive Health, Complains Of 'Deplorable' Debt Collection Practices

The problems just keep piling up for the nation's most famous collector of hospital debts.

Accretive Health, the Chicago-based debt collection company, made headlines earlier this year when Lori Swanson, attorney general of Minnesota, released a report that accused Accretive of badgering and deceiving hospital patients in order to extract payment. Now, Accretive faces a shareholder lawsuit and claims its "deplorable" collection methods dealt a severe blow to the company's earnings and stock price.

Shareholder Jeffrey Goodwin is leading the charge, according to Courthouse News Service. Goodwin's complaint appears to include a laundry list of Accretive's alleged transgressions, including losing a laptop containing thousands of confidential medical records and sending collectors into emergency and recovery rooms to talk about bill settlement.

Accretive has meanwhile been shedding clients in Minnesota. Fairview Health Services and Maple Grove Hospital, two of the three health care providers in the state with which Accretive had contracts, have severed ties with the company following Swanson's report and hearings led by Senator Al Franken.

While public attention has lately been focused on Accretive, hospital debt collection is a big industry that's not likely to shrink any time soon. Hospitals had more than $39 billion worth of unpaid bills in 2010, according to the American Hospital Association. In large part, that's because they're required to treat anyone who shows up in the emergency room, even if the patient can't pay.

Last month, most likely in response to the revelations about Accretive Health, the Treasury Department proposed rules that would apply to about half of all U.S. hospitals, and would mandate a four-month grace period for patients to seek financial assistance before hospitals could send their debt to a bill collector.