A Greensboro, N.C. hospital has filed a lawsuit seeking more than $5 million from an Illinois company it hired to hand its collection efforts.
Moses Cone Hospital officials allege that SPi Healthcare's failure to collect in a timely manner resulted in a loss of at least $2.8 million. According to court documents, Moses Cone officials claim that as of September 2012, SPi took an average of 93 days to recover collections, as opposed to the industry average of 35 to 40 days. The suit, filed in U.S. District Court, also alleges SPi didnt assign a dedicated team to properly review denied insurance claims, causing an additional loss of $1.75 million, according to the Winston-Salem Journal.
Moses Cone hired SPi in August 2011 to manage claims management and accounts receivable services. The hospital paid an average of $670,561 a month over the past year to SPi, according to the suit. Hospital officials would not comment on pending litigation but did confirm the hospital has ended its agreement with SPi.
The hospital acknowledges the days to recover figure dropped to 69 by July, but has stated that the decrease was because of "SPis write-offs of accounts receivable and not due to its actual collections efforts.
SPi officials would only state that Moses Cones suit is "completely without merit." A spokesperson for Moses Cone said the hospital could not comment on pending litigation. However, Mike Simms, vice president of revenue cycle for Cone Health, did confirm the hospital has terminated its agreement with SPi.