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The Indiana Attorney General’s Office has launched an investigation into DECA Financial Services after Brian Knox, a Columbus resident who was overdue paying a $210 Columbus Regional Hospital emergency room bill, complained of deceptive practices by the Fishers-based collections agency.
Jeremy Comeau, deputy attorney general in the Consumer Protection Division, has sent DECA an investigative demand notice, asking the company to divulge:
The state Attorney General asked DECA Financial Services for numerous documents, including:
Copies of all agreements entered into with creditors or other debt buyers since Jan. 1, 2012, to purchase or collect purported debts of Indiana residents.
Copies of complaints received regarding collections or business practices.
Forms used to communicate with debtors and standard responses to disputes of debt.
Copies of any pre-recorded messages used with automatic dialing machines to collect debts from Indiana residents.
How to file a complaint
The state Attorney General’s Office provides an electronic complaint form.
The form asks for details of the purchase or transaction in question, whether it involved cash, check, credit or some other form of payment, and if the consumer has brought the complaint to the attention of the business.
If the consumer has a contract or written agreement, the AG directs consumers to download the complaint form, print it out, sign and attach a copy of the contract/written agreement to the form and mail it to the Consumer Protection Division.
Mailing to: Office of the Indiana Attorney General, Consumer Protection Division, 302 W. Washington St., Fifth Floor, Indianapolis, IN 46204-2770
For the online complaint form go to: indianaattorneygeneral.secure.force.com/ConsumerComplaintForm
For other information: www.indianaconsumer.com
Source: Indiana Attorney General
The state’s inquiry comes a few weeks after Knox filed a formal complaint with the attorney general alleging that he was the victim of deceptive-collections practices by DECA. He said the company provided only one notice of his debt on Jan. 27, 2012, and never sent a final notice outlining that its next step would be to take him to court to collect on emergency-room charges and a late fee.
A lawsuit wasn’t filed until May 29 this year, nearly two years after Knox’s teenage son, Adam, initially went to Columbus Regional Hospital’s emergency department with complications linked to a burst appendix. The boy was transferred to Riley Hospital for Children at Indiana University Health in Indianapolis, where he was treated for digestive tract failure and other complications over four weeks in July and August 2011.
“I am certain that Mr. Knox’s (case) had something to do with the AG’s civil investigative demand, and that’s fine,” said Paul Jefferson, DECA’s in-house general counsel. “We’re happy to talk with the attorney general and explain what we do. We are doing things legally and properly.”
Jefferson said the company will open its books, records and policies to the attorney general’s office.
After doing so, he expects DECA to be cleared of any allegations that it violated either the Indiana Deceptive Consumer Sales Act or the Federal Fair Debt Collection Practices Act.
Meanwhile, DECA has since filed a lawsuit to collect from the Knox family the past-due $155.70 emergency room charges, plus a $54.50 late fee. The collections agency also tacked on $92 in court costs and $375 in attorney fees as part of its suit, bringing Knox’s total debt to $677.20 for medical care provided in July 2011.
Knox is contesting the case, saying he wasn’t given proper notice of the debt and alleging that the legal fees he’s being asked to pay are exorbitant based on industry standards. The case is set for a court hearing in Bartholomew County Superior Court II on Oct. 4.
Comeau of the attorney general’s office didn’t respond to an email seeking comment on the consumer protection investigation.
Originally, the office asked for a response from the collections agency by Aug. 30, but Jefferson said it likely would take longer to provide all the data that investigators want, and he was negotiating with Comeau for an acceptable timeline.
$200,000 in medical bills
The medical emergency that led to this dispute started on July 16, 2011, when Knox’s then-14-year-old son was rushed to Columbus Regional Hospital’s emergency room. Over the next several weeks, the Knox family ran up roughly $200,000 in medical bills, and insurance didn’t come close to covering all the expenses, said Knox, a software engineer who also had to endure a brief period of unemployment around the time of his son’s illness.
“DECA mailed us exactly one notice of this debt — $155.70 for emergency room services plus a $54.50 late fee — on Jan. 27, 2012, and the notice became lost in the shuffle of a hundred other bills,” Knox said.
After various bills began pouring in, Knox said he was confused by the fact that there were charges from Columbus Regional Hospital itself and also from Emergency Physicians of Columbus, a doctors group that he later learned staffs the hospital’s emergency room under contract.
The physicians group bills separately from the hospital, a fact that Knox said he didn’t comprehend for a long time.
In fact, the first bills from the emergency room doctors were processed by a third-
party contractor, Professional Medical Billing of Fort Wayne.
Linda Pearce, president of Professional Medical Billing, said Knox got four statements of what the family owed before his case was even sent to DECA for further collection work. Professional Medical Billing operates in several states and handles initial billing and record-keeping for emergency medical practices and office-based doctors with a total of 1 million annual visits, Pearce said.
Knox said he had to juggle insurance deductibles, negotiate with various medical providers for discounts and deal with at least three more collections agencies other than DECA during this period. Knox said he thought all his bills were settled by July 2012, including debts owed to Columbus Regional Hospital’s emergency room
Then, 10 months later, DECA filed suit over the emergency room bill, Knox said.
A matter of principle
Knox said he could pay the DECA bill today, but he has decided instead to fight what he considers unfair consumer practices. He has filed complaints with the Indiana Attorney General’s Office and the Federal Trade Commission. He also tried to enlist dozens of other debtors being sued by DECA for medical debts in other cases in Bartholomew County in a potential class-action lawsuit.
Earlier this summer, Knox circulated a one-page letter to other defendants being sued by DECA, encouraging them to seek 60-day continuances in their own cases and share their email addresses to facilitate a collective strategy. The letter carried the headline: “Hoosiers Fight Back against DECA.”
In June, Knox said, he was called by a DECA staff member, who said if he paid $677.20 in full that day, the company would take the overdue charges off his family’s credit report.
The collections agent said the company had sent him five letters and made 19 calls seeking to collect the debt, Knox contends in a transcript he kept of the phone
But Knox said he has a record of only three voice mails left by the company at his home between Jan. 30 and Feb. 9, 2012, and there was only one letter sent from DECA seeking payment.
Separately, Knox contends the $375 in legal charges being sought by DECA are unreasonable because the collections agency files hundreds of cookie-cutter lawsuits across Indiana — a factor that he said should reduce their costs per case since all the suits are nearly identical.
Some other collections agencies in Indiana assess only $200 in legal fees, he said, adding that he managed to work out discounts or payment plans with three other bill collectors after his son’s illness.
In Bartholomew County alone, DECA has filed at least 173 debt-collection lawsuits since Jan. 1, with most of them attempting to collect on past-due medical bills. According to court records, 136 of those cases are pending, including the one against Knox and his family.
Jefferson, DECA’s lawyer, disputes Knox’s claims that DECA files a high volume of lawsuits to collect exorbitant legal fees. He said the collections agency follows state and federal laws in how it treats debtors, adding he welcomes anyone to look into DECA’s practices, including the Indiana Attorney General’s Office or the General Assembly.
“It doesn’t make sense for us to go out and sue everybody,” Jefferson said. “We only sue those people who we believe have the ability to pay and choose not to do so.”
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