Accretive's Bedside Manner for Debt Collection

The end of last week got a little busy for many of the Credit Slips bloggers and none of us talked about the story last Wednesday by Jessica Silver-Greenberg at the New York Times regarding aggressive debt collection practices by Accretive at hospitals. The allegations came to light in a report by Minnesota attorney general, Lori Swanson. Among the most appalling claims was that Accretive posted employees in emergency rooms, demanding payment before treatment was administered. Forget the legal side of this. How does a person or an organization get to a place where these sorts of tactics seem like the right thing to do? (In fairness, it should be noted that Accretive has denied the claims made by Attorney General Swanson.)

My colleague, John Colombo, has a post up at the Nonprofit Law Prof Blog discussing the tax-exempt status issues for nonprofit hospitals that deploy aggressive debt collection practices such as those alleged to have been done by Accretive. John's work raises a bigger question: should we still give nonprofit hospitals a tax exemption if they are not doing charitable work in a different sense of the word?