By Kenneth Long on April 24, 2012

A lost laptop with private patient data may have been just the tip of the iceberg. Minnesota Attorney General Lori Swanson has since pointed the finger at Accretive Health for placing collection agents between patients and emergency room caregivers.

The charges are appalling. Swanson's office has claimed that Accretive Health arranged to have its own collection agents staff front line positions at hospitals' emergency rooms. Collection agents who called themselves "financial counselors" were required to press for patients to pay up before they would be treated.

Indeed, there are allegations that treatment was delayed while Accretive Health's debt collection agents would pressure emergency room patients to come up with payment before they would be allowed to see a doctor. In some cases, the patient would be expected to cough up money owed from a previous visit. In other cases, agents wanted the patient to prepay for today's visit. Some patients whose names appeared on "stop lists" faced intense collection attempts prior to treatment.

Accretive Health had hospital permission for its agents to staff the hospital premises. Its agreements mandated that agents would be able to fill certain front-line positions in order to keep costs down.

According to the attorney general, the arrangements are a clear violation of the Health Insurance Portability and Accountability Act (HIPAA). Patients' records were not carefully protected by hospital staff.

Not everyone insists that a crime has been committed. Some believe that the costs of healthcare are already high because of repeat visitors that are uninsured and refuse to pay. Many poor patients go to high-cost hospital emergency rooms because they believe they will be turned away from regular doctors that require upfront payment. There were even allegations of some patients faking an emergency so that they could get a $600 ambulance ride to the hospital and therefore avoid having to pay for a taxi.

Still, a line must be drawn somewhere. If the person is employed by the hospital and subject to hospital procedures and oversight, then they should appear as a hospital employee. Anyone else should be easily distinguishable from regular hospital staff. Furthermore, they should not be handling patient records with such ease and recklessness.

To that end, Swanson's office did file a lawsuit against Accretive Health in January 2012. Swanson accuses the company of violating patient privacy laws. Both Minnesota and federal debt collection laws may also have been violated.

The practice may be quite widespread. Accretive Health has agreements with several of the largest hospitals in the country. Other medical debt collection agencies may employ similar strategies, which would make them likely targets of regulatory scrutiny. Only time will tell if other states get involved as this investigation unfolds further.

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Note: Patients can get legitimate help with medical bills, including that from actual hospital staffers.

By Kenneth Long on April 20, 2012

Existing Capital One checking account holders may have recent received a letter that provides a choice, and an ultimatum. You must choose which type of new checking account arrangement you want, unless you want to automatically begin incurring a $14.95 monthly checking account fee.

The ultimatum date is June 5, 2012. You must make a choice and notify Capital One before they will select your option for you.

Capital One's choice by the way is the Premier Rewards Checking account. This account includes a $14.95 monthly maintenance fee, which adds up to a whopping $179.40 annually. If you would prefer not to pay this fee you do have some options.

How to Avoid Paying Monthly Maintenance Fee

If you do want to earn "DOUBLE rewards automatically for everyday banking activities" (whatever that means), then you may want to stick with Premier Rewards Checking. There are a couple of ways that you can select this account and still qualify for a $14.95 fee waiver.

• A monthly direct deposit of at least $1,000 can reverse the fee. Note that the requirement is for at least a single direct deposit of $1,000 or more. Multiple smaller direct deposits apparently do not qualify, so this will keep most lower income customers out of this category--not exactly consumer friendly.
• Maintain an average monthly balance of at least $1,500. It is OK if your balance drops below this, since it is not a minimum balance requirement, but you must maintain an average balance of at least that amount to avoid paying the fee. Again, most lower income customers will not qualify.
• Maintain an average of $3,000 in combined monthly account balances. That allows you to move some into a higher earning savings account (hardly a benefit) and still qualify for a fee waiver. Again, strike three for the lower income families that bank there.

A scaled back version of the Premier Rewards Checking account is the Rewards Checking product. It only has regular rewards rather than double rewards (so sad), but it is easier for lower income families to qualify for a waiver of its $8.95 monthly fee.

• Receive at least one monthly direct deposit of $250 or more. This should help most lower income families qualify as long as their employer offers direct deposit (and they are not paid weekly).
• Maintain a $300 minimum daily balance. Rather than an average balance, this means that allowing your balance to drop to $299.99 for just one day can cause you to incur the $8.95 monthly fee.

Finally, you may select their basic product, the High Yield Free Checking account. It has no rewards but most importantly, no monthly fee either. In case you are thinking this is definitely the one for you, think again! The High Yield Free Checking account requires one of the following:

• Maintain least $5,000 in average monthly balances (may be combined across checking, savings, and investments).
• Have a mortgage loan serviced by Capital One.

If you cannot meet one of the two requirements for High Yield Free Checking, then your account will be automatically closed or converted to one of the other fee-based checking accounts. If you don't choose, then Capital One will choose for you.

In case you are wondering, Capital One is not the only "bad guy" that is trying to eliminate free checking for unprofitable accounts. Almost every big bank has been trying to find the right balance of increasing fees without sending the customers running for the hills.

Of course, if you can handle the switch to a community bank or credit union, then you can lock in free checking privileges. Move to a community bank or discover the benefits of credit union membership and leave the big banks that do not appreciate your business behind.

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Note: This article is provided for informational purposes only. Debtors Unite is not related to, nor does it endorse any product or service by Capital One.

By Kenneth Long on April 18, 2012

The largest collector of medical debt in North Carolina fought tax assessments on three corporate jets for five years. Now it has agreed to pay up after losing appeal after appeal. Does that make Absolute Collection Service a victim of its own game?

Why a collection agency needs three corporate jets is a mystery to me. Of course, I am sure the executives love having access to them for personal use.

Regardless of their use, the firm owed back taxes to Wake County, NC where the planes have been based. After rounds of appeals, the firm has finally agreed to a payment of $189,000 to settle back taxes owed on the aircraft.

Absolute Collection Service fought the county tooth and nail about the tax assessments. It used numerous appeals, yet does not provide the same level of protection for the debtors that owe it money.

Through a combination of mailed notices and collection calls, the company contacts those whose medical and other debts have been placed with the firm. Debtors who are unable to pay are not given any relief. Instead, just like at any collection agency, they are told to pay up.

Watching a collection agency refuse to pay a legitimate tax debt is quite entertaining. One must also wonder how much was spent in legal bills as they tried to get out of paying less than 200 grand in back taxes over the course of a five year dispute.

In order to get out of future taxes, the firm initiated a sale and lease back of one of the aircraft just to evade county property taxes. It is apparently legal, and was done intentionally in response to a change in tax law.

Debtors who owe Absolute Collection Service might want to see if the firm will allow them to dispute their collection bills through numerous appeals. Clearly the firm believes that a debtor has the right to fully appeal any debt over an extended period of time. By the way, the statute of limitations on private debt in NC is only 3 years, making an extended appeal process advantageous to the debtor!

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Contact information for the firm is: 919-755-3900

If you are having difficulty paying medical debt with any debt collector, see how you can get help with medical bills.

By Kenneth Long on April 18, 2012

Hawaii Attorney General David M. Louie has filed a lawsuit against each of seven credit card issuers who sell payment protection for their credit card products. According to the suits, many of the policies are sold to cardholders even though they don't qualify for the benefits should they need to use the protection.

Named in the lawsuits are Bank of America, Barclays, Capital One, Chase, Citi, Discover and HSBC. With potential penalties of $10,000 per violation, this is the type of case that could really shake up the credit card industry if it had any teeth to it.

There are some problems with the state's case, yet there are also some problems with the card issuers' policies for credit card payment protection. Here are the main issues:

1. Improper Charges for Unwanted Protection. The state's lawsuits suggest that cardholders were charged for services that they either did not want or did not request. The problem with this argument is that card issuers specifically require that a cardholder's consent is obtained prior to initiating coverage. This may be in the form of an initial on a credit card statement or application where they opt in to the coverage, or this may be a recorded verbal consent on a telemarketing call. In either case, the proper consent is normally obtained.
2. Products Did Not Provide the Claimed Benefits. The state suggests that many cardholders who signed up for the payment protection programs did not understand the restrictions placed on actually receiving benefits should they need them. The state claims that cardholders did not understand and were not properly informed about the restrictions prior to enrollment. The state may have some leverage on this point, which is enough to cause worry among major credit card issuers should it set a precedent in Hawaii. Other states would surely pursue similar lawsuits against the issuers.

Interestingly, the Hawaii lawsuits omit a third issue that should have been included. It has to do with the cancellation of coverage. In order to opt in, a cardholder only has to initial on the statement or verbally consent while on the phone with the card issuer's customer service representative or telemarketer. However, verbal requests to cancel are not honored. Instead card issuers require that the cardholder send a written cancellation to a specific address, which is often with a designated third party.

The onerous cancellation policies are what generates additional revenues for the card issuers. Many cardholders simply do not follow through on their cancellation request, causing them to continue to be billed hundreds of dollars a year in unwanted premiums. Others do follow through but often pay extra for coverage that is supplied during the lag time between their request is mailed and when the cancellation is actually implemented.

Debtors Unite believes that credit card payment protection is generally a bad deal and contributes substantially to a cardholder's chronic indebtedness. That cardholder would have been far better served by either putting those payment protection premium dollars towards the principal balances of the cards or even putting them into savings for a rainy day. Either way, they would have been prepared to cover the payments themselves.

We will be watching the Hawaii lawsuits for developments. However, in omitting the complaint regarding cancellation procedures, we believe the state really missed the big argument that could have given them a stronger stand against the card issuing giants.

By Kenneth Long on April 17, 2012

West Virginia Attorney General Darrell McGraw has sued seven debt collectors after they ignored investigative subpoenas. The firms failed to obtain a license for the collection of consumer debt. Furthermore, they have been accused of substantial violations of the Fair Debt Collection Practices Act (FDCPA).

The initial violation committed by each of the seven firms was the attempted collection of consumer debts without first obtaining the proper licenses. West Virginia law requires that collection agencies obtain a license with the state prior to contacting residents to collect on unpaid debts.

More substantial violations were committed by several of the firms. Debtors were threatened with arrest and imprisonment if they did not pay. In some cases, the collection agents claimed that they were representatives of law enforcement or judicial officers.

The firms had been under investigation by the attorney general, but in each case they defied the subpoenas and failed to comply with the investigations. Now West Virginia has taken action to stop all illegal activities by the firms. The lawsuit names the following unlicensed debt collection firms:

• County Filing Services, Inc., and owner Todd Loop
• Portfolio Investment Financial, also owned by Todd Loop
• Investment Management and Recoveries, Inc., and owner Randall Ray Goins
• Rosenthal, Stein and Associates, LLC, and owner Sharisse Williams
• Vision Credit Solutions, LLC, and owner James P. Belstadt
• National Capital Management, Inc., and owners Ryan Daniel Todora and Natlie Lynn Rowe
• Dorsey Thornton & Associates, LLC, and owners Wyteria Dorsey and Michael Thornton

The investigations were launched following dozens of complaints by residents against the firms for aggressive and illegal collection activities. The firms collected phony debts and continued collection activities on legitimate debts even after the debts had already been repaid.

The firms failed to supply information requested by McGraw's office as requested by investigative subpoenas. The firms also brazenly refused to apply for debt collector's licenses yet still pursued debts from West Virginia residents.

Attorney General Darrell McGraw released the following statement:


Residents of any state who believe their rights have been violated are encouraged to contact their state's attorney general to file a formal complaint. Victims may also file FDCPA lawsuits against rogue debt collectors to pursue damages.