Minnesota AG Sues Hospital Debt Collection Agency for Patient Privacy Violations

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Minnesota Attorney General Lori Swanson has filed suit against Accretive Health, a debt collection agency, for not protecting patient confidentiality and not informing patients of the agency's "extensive involvement" in their healthcare at two hospital systems in the state.

In July 2011, an Accretive employee lost a laptop that contained unencrypted health data for about 23,500 Minnesota patients from Fairview Health Services in Minneapolis and North Memorial Health Care in Robinsdale.

The suit claims Accretive gained access to this data through contracts with the hospitals and numerically scored patients' risk of hospitalization and medical complexity. The agency also allegedly graded patients' "frailty," identified certain patients as "outliers" and compiled per-patient profit and loss reports.

Accretive controls the revenue functions of the hospitals, including front office, billing and collections. It reports to Wall Street investors that it carries out these functions using data mining, consumer behavior modeling and propensity to pay algorithms. The suit claims the agency violated state and federal health privacy laws, state debt collection laws and state consumer protection laws.

"The debt collector found a way to essentially monetize portions of the revenue and healthcare delivery systems of some non-profit hospitals for Wall Street investors, without the knowledge or consent of patients who have the right to know how their information is being used and to have it kept confidential," said Attorney General Swanson.

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