The Washington State Attorney General’s office has filed a lawsuit against a collection agency, accusing it of failing to comply with state law by not disclosing consumers’ rights regarding medical debt information. The lawsuit claims that the collection agency sent more than 400,000 collection notices to Washington residents without the necessary disclosures, a violation of the state’s Collection Agency Act.
In 2019, the Washington legislature amended the Collection Agency Act, requiring collection agencies to include key information in their initial collection notices for medical debt. Specifically, they must inform consumers of their right to request information like the original account number, the date of the last payment, and an itemized statement of the debt. However, Renton Collections allegedly failed to include these disclosures in letters sent between 2019 and 2024, according to the complaint, which was filed in Washington state court.
Despite these legal requirements, the agency continued to collect more than $35 million in medical debt, with the company earning more than $7 million in commissions through these practices. The state is now seeking civil penalties of up to $7,500 for each violation, along with restitution for affected consumers and an injunction to prevent further violations.
Medical debt collection is a sensitive area, given the complexity and often unexpected nature of medical expenses. The legislature’s changes in 2019 were designed to better protect consumers, ensuring they were aware of their rights and the information available to them regarding the debts being collected.
The lawsuit emphasizes that Renton Collections’ actions were not only a violation of the Collection Agency Act but also the state’s Consumer Protection Act, as they misled consumers about their legal rights and failed to provide vital information. The court will consider whether further actions, including restitution and the repayment of any excess charges, should be mandated.
