A District Court judge in Illinois has denied a healthcare provider’s motion to dismiss a claim it violated the Illinois Consumer Fraud and Deceptive Business Practices Act (ICFA) and a collection agency’s motion to strike class allegations it violated the Fair Debt Collection Practices Act in a debt parking case on a medical debt.
A copy of the ruling in the case of Jackson v. Jersey Community Hospital and Consumer Collection Management (CCM) can be accessed by clicking here.
The plaintiff visited the hospital in 2018 and provided her Medicaid insurance information with the understanding that any bill would be submitted there. The hospital sent the plaintiff four statements in the following four months, each attempting to collect on a balance of $321. The plaintiff thought that the hospital was going to bill Medicaid for that amount, so she did nothing. The balance was then placed with CCM, which began reporting the debt to the credit reporting agencies and sent a letter. In April 2019, the hospital billed Medicaid and it paid the amount. The hospital failed to notify the agency that the debt had been paid and the agency continued reporting the now-paid debt for two more years on the plaintiff’s credit report. The plaintiff allegedly confronted the agency, but it did not do anything to correct the mistake until the plaintiff paid a credit repaid company to mitigate the problem.
The hospital argued in its motion to dismiss that it nothing false or deceptive because it ultimately billed Medicaid for the service and because the plaintiff owes nothing to the hospital. The hospital’s argument that the plaintiff can only demonstrate a deceptive practice if the hospital communicated that she owed money after Medicaid paid the bill, but what Chief Judge Nancy J. Rosenstengel of the District Court for the Southern District of Illinois determined is that the hospital billed Medicaid, was paid by Medicaid, and failed to call off the debt collector, allowing it to try and collect a “double payday,” which inferred “multiple deceptive representations and actions” on the part of the hospital.
The collection agency tried to convince the judge that the definition of the potential class was too broad, too open-ended, and too subjective, but Judge Rosenstengel considered the agency’s motion “premature.”
“At this time, discovery must proceed to garner more insight as to class certification,” Judge Rosenstengel ruled.