PORTLAND — A Chicago-based company that is being sued by the Minnesota Attorney General’s Office has been hired to provide management support services to Mercy Hospital.

Catholic Health East announced this week that Accretive Health Inc. has been chosen to be the health system’s “revenue cycle operating partner.” Mercy Hospital is a member of Catholic Health East, said Susan Rouillard, the Portland hospital’s chief development and communications officer.

She said Wednesday that the allegations by Minnesota Attorney General Lori Swanson that Accretive Health posted debt collectors in hospital emergency rooms and at the bedsides of patients had just come to Mercy’s attention.

“Catholic Health East and Mercy did our due diligence and we are comfortable with that,” Rouillard said about the parent company’s decision to partner with Accretive Health.

Accretive Health partners with health care providers to help them more effectively manage their revenue cycles, strengthen their financial stability and improve the quality of care they provide while reducing overall health care costs, according to the company’s website.

Rouillard said Accretive Health Inc. will provide support for Mercy Hospital’s work flow technology and revenue cycle management. She would not be more specific.

Rouillard said Mercy will be Catholic Health East’s first “test site” under the contract with Accretive Health.

Catholic Health East, based in Newtown Square, Pa., is a multi-institutional Catholic health system co-sponsored by eight religious congregations and Hope Ministries. The system operates in 11 states from Maine to Florida and includes acute-care hospitals, long-term care facilities, assisted-living homes, retirement homes and hospice agencies.

Rouillard said Accretive will have a “back office” role in Portland. “Our Mercy employees have been, and will remain, the front-line people for dealing with our patients,” she said.

Bloomberg News Service reported this week that Swanson sued Accretive Health in January, alleging violations of U.S. and state patient-privacy and debt collections laws.

Swanson claims that patients of Fairview Health Services, a charitable hospital chain in Minnesota, were pressured for payment before they received care in some cases, and that Accretive Health’s debt collectors didn’t properly disclose their role.

Bloomberg quoted Swanson as saying that emergency room employees were issued “scripts” for conversations with patients that “can lead a patient or her family to believe the patient will not receive treatment until payment is made.”

Documents provided to The Portland Press Herald on Wednesday by Swanson’s office show that Fairview entered into a revenue-cycle operations agreement with Accretive Health on March 29, 2010.

Those documents, part of a review of Fairview Health Services’ contracts with Accretive Health, say “Accretive is, in essence, an India-outsourced collection agency. Accretive has two offices in India. A majority of its employees are located in India.”

In the review, issued this month, Swanson says Accretive Health told her staff that the function of the India office “is to lower labor factor costs.”

“Accretive’s control over Fairview is breathaking,” the review says. “For instance, in 2011, Accretive advised Fairview that it would charge an additional $3 million in base fees because Fairview did not obtain prior approval to hire more than 20 mental health and home and other health care employees.”

The review says Accretive Health could boost its stock value by sending jobs to India.

Ben Wogsland, spokesman for the Minnesota Attorney General’s Office, told the Press Herald, “It’s our belief they are doing the same thing in other hospitals. This is not Minnesota-specific. We don’t have a reason to believe this isn’t happening elsewhere.”

“We are working to resolve outstanding issues as soon as possible,” Rhonda Barnat, a spokeswoman for Accretive Health, said Wednesday. “We have a great track record of helping hospitals enhance their quality of care. For example, we’ve helped 250,000 patients get insurance coverage.”

Jeffrey Austin, vice president of government affairs for the Maine Hospital Association, said he was unaware of the lawsuit against Accretive.

“Generally, our hospitals are very small and work with the people to resolve bill situations,” he said. “We have generous charity coverage in Maine. We haven’t run into these issues with aggressive debt collection.”

Staff Writer Jessica Hall can be contacted at 791-6316 or at:

jhall@pressherald.com

Staff Writer Dennis Hoey can be contacted at 791-6365 or at:

dhoey@pressherald.com