Providence debt collector to pay $1M to settle lawsuit

A debt collection agency hired by Renton, Wash.-based Providence has agreed to pay $1 million to resolve allegations the company unlawfully collected medical payments from about 166,000 Washington patients without providing them with disclosures about their rights when faced with medical debt. 

Harris & Harris is one of two debt collections hired by Providence, which recently agreed to provide $157.8 million in refunds and debt relief to low-income patients as part of an agreement with the state Office of the Attorney General, according to a Feb. 21 news release from that office. 

Washington Attorney General Bob Ferguson filed his lawsuit against Providence in February 2022. That summer he expanded the suit to add Harris & Harris and the health system's other debt collection agency, Optimum Outcomes.

Mr. Ferguson alleged the agencies collected on medical debt without informing patients of their right to request specific information about their debt. The companies also failed to provide a phone number for the hospital where patients received care so they could learn about their financial assistance rights, according to the release. 

Optimum Outcomes is scheduled to go to trial over the allegations Feb. 22. Mr. Ferguson also alleged that Optimum failed to inform patients that they may be eligible for financial assistance as required by state law.   

The settlement with Harris & Harris requires the company to reform its practice to include legally required disclosure in first written collection notices in the future, according to the release.   

"Harris & Harris will pay for consumer education to approximately 166,000 Washingtonians who received the debt collection letters that lacked the disclosures," the release said. "These individuals will receive a letter explaining their medical debt collection rights, including their right to apply for financial assistance on hospital bills. The $1 million will fund future consumer protection enforcement work."

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