Washington State

Office of the Attorney General

Attorney General

Bob Ferguson


Ruling resolves Ferguson’s case against last remaining defendant in charity care lawsuit against Providence and its debt collectors

SEATTLE — The Attorney General’s Office won a trial against debt collection agency Optimum Outcomes. Optimum is the last remaining defendant in Attorney General Bob Ferguson’s charity care lawsuit against Providence Health & Services, one of the nation’s largest health care systems, and its debt collectors.

King County Superior Court Judge Sean O’Donnell ruled that Optimum violated the Consumer Protection Act by violating the medical debt collection rights of Washington patients more than 82,000 times. Judge O’Donnell ordered Optimum to pay $10 per violation for a total penalty of $827,290, which will go to the state general fund. Optimum must also reimburse the Attorney General’s Office for the costs of bringing the case, which are estimated to exceed $400,000. The court will determine the exact amount in a future proceeding. Finally, Optimum must make reforms to come into compliance with Washington law.

Optimum Outcomes unlawfully collected payments from those patients without providing critical information about their rights when faced with medical debt. By excluding the legally required disclosures about financial assistance in its collection letters, Optimum Outcomes created barriers that kept patients who likely qualified for financial assistance from learning about and accessing help with their hospital bills.

“This legal victory resolves the largest charity care lawsuit in American history,” Ferguson said. “We delivered economic justice for Washingtonians in the form of corporate reforms and more than $160 million in direct payments, debt forgiveness and civil penalties. My team and I partnered with legislators, hospitals and patient advocates to protect Washingtonians from out-of-pocket hospital expenses they can’t afford — and we will make sure that Washingtonians receive these protections.”

On Feb. 2, the court found that Optimum Outcomes failed to provide the required charity care disclosures in 82,729 first written collection notices it sent to Providence patients, which violated the state’s Collection Agency Act and Consumer Protection Act.

Patients who were likely eligible for financial assistance but were sent to collections and paid for their care will receive refunds, including interest, as a result of the resolution with Providence. Patients who incurred debt when they were likely eligible for financial assistance will have their debt written off as a result of the resolution with Providence.

Assistant Attorneys General Audrey Udashen, Will O’Connor, Michael Bradley, Matthew Geyman, Lucy Wolf, Tad Robinson O’Neill and Robert Hyde, Paralegals Jen Killoren, Judy Lim, Matthew Hehemann and Joseph Drouin, and Legal Assistants Josh Bennett and Michelle Paules handled the case for Washington.

This is the latest of hundreds of consumer protection wins since Ferguson became Attorney General. Since January 2013, the office has filed 808 successful lawsuits under the Consumer Protection Act. In that same time, Ferguson has only lost two consumer protection cases — a case against Value Village and a challenge to the special dividend paid by Albertsons to its shareholders ahead of the company’s proposed merger with Kroger.

Providence debt collector illegally excluded disclosures in notices to patients

On Feb. 1, Providence entered into a legally enforceable agreement that requires the health system to provide $157.8 million in refunds and debt forgiveness to nearly 100,000 patients over unlawful medical charges to Washingtonians who likely qualified for free or reduced-cost hospital care.

In the summer of 2022, Ferguson expanded his lawsuit against Providence by adding the health system’s two debt collection agencies: Optimum Outcomes and Harris & Harris. On Feb. 21, Harris & Harris entered into a legally enforceable agreement with the Attorney General to pay $1 million and reform its practices, resolving that case and leaving Optimum Outcomes as the sole defendant for trial.

The court found that Optimum Outcomes failed to inform patients that they may be eligible for financial assistance, as required by state law. It also collected on medical debt without informing patients of their right to request specific information about that debt. Optimum also failed to provide a phone number for the hospital where patients received care, preventing many of them from learning about their financial assistance rights.

Both collection agencies entered into a contract with Providence in September 2019. The agreement allowed them to collect hospital debts on Providence’s behalf and act as its agents.

When sending a first collection notice, collection agencies must include:

  • Written notice that an individual may be eligible for charity care;
  • Contact information for the hospital; and
  • Notice that the patient has the right to request the hospital account number assigned to the debt, date of last payment, and an itemized statement stating whether the patient was found eligible for charity care, and, if so, the amount due after all charity care has been applied.

From February 2020 to July 2021, Optimum Outcomes sent 82,729 first written collection notices without these legally required disclosures, collecting more than $3.3 million from patients in the process. Optimum Outcomes earned more than $376,000 in commissions from Providence on those collection activities. Moreover, during that period — the entirety of the time it collected medical payments on behalf of Providence — Optimum Outcomes was not properly licensed to collect on medical debt in Washington. 

Providence billed, aggressively collected from low-income patients

Ferguson filed his lawsuit against Providence in February 2022, accusing its affiliated hospitals of billing and aggressively collecting money from low-income Washingtonians without determining if they qualified for financial assistance.

Ferguson’s Consumer Protection investigation started in 2020, following complaints about collection practices at Swedish. It revealed Providence engaged in numerous practices between 2018 and 2022 that prevented patients from accessing financial assistance. Providence trained employees on aggressive and deceptive collection tactics. Their script included:

  • “Ask every patient every time” to pay outstanding medical costs;
  • “Don’t accept the first no;”
  • If a patient declines the first request, ask for partial payment;
  • Use phrasing that signals to patients “payment is expected.”

The lawsuit asserted that Providence knew many of its patients were likely eligible for financial assistance and not only failed to inform them, but also kept collecting payments from them. In fact, Providence sent thousands of patients it identified as “presumptively” qualified for financial assistance to debt collectors. Internal emails revealed Providence did this because it knew those patients were more likely to pay their bills if collection attempts continued.

Moreover, starting in 2019, Providence sent thousands of Medicaid patients to debt collectors. Medicaid enrollees are among the lowest income Washingtonians, and are deemed eligible for financial assistance under Providence’s own policies. Providence staff caught the issue early and raised concerns to leadership. In fact, according to internal records, one employee warned: “We are sending the poor to bad debt and not treating them the same as other patients.” Providence did not correct the problem for more than two years.

Even when Providence wrote off debt for patients it later determined to be “presumptively” qualified for financial assistance, the company kept them in the dark about those write-offs, and therefore their eligibility for future assistance.

In all, Ferguson asserts that Providence’s deceptive and unfair practices amounted to more than 100,000 violations of the state Consumer Protection Act.

The case against Providence is part of Ferguson’s Health Care Initiative. The resolution is the largest of four charity care cases handled by his office, resulting in more than $205 million in debt forgiveness and refunds for Washingtonians. Washington is one of 11 states with broad charity care protections and the only state to pursue any large-scale enforcement.

Ferguson’s three other charity care resolutions include:

  • PeaceHealth agreed to pay up to $13.4 million to more than 15,000 low-income patients, including $4.2 million in direct refunds and up to $9.2 million through a claims process.
  • CHI Franciscan provided $41 million in debt relief and $1.8 million in refunds, in addition to rehabilitating the credit of thousands of patients.
  • Capital Medical Center in Olympia paid at least $250,000 in refunds and provided more than $131,000 in debt relief to resolve Ferguson’s lawsuit filed in 2017.

Anyone who feels they are not receiving the financial assistance on their hospital bill they are entitled to should file a complaint with the Attorney General’s Office.

New law expands access to medical financial assistance

Before 2022, state law required hospitals to provide free or reduced-cost care to Washington families making up to 200% of the federal poverty level.

In March 2022, the Legislature passed an Attorney General Request bill strengthening Washington’s medical financial assistance law. It went into effect July 1, 2022. Ferguson worked with prime sponsor Rep. Tarra Simmons, D-Bremerton, and Reps. Eileen Cody, D-Seattle, and Nicole Macri, D-Seattle, on House Bill 1616. The new law expanded eligibility for financial assistance to more than one million Washingtonians and guaranteed free hospital care to an additional million Washingtonians.

Now, approximately half of all Washingtonians are eligible for free or reduced-cost hospital care. Washingtonians up to 300% of the federal poverty level are now eligible for free care at the state’s large health care systems and large, urban hospitals — representing approximately 80 percent of the licensed beds in the state. The bill also significantly increased medical financial assistance at the state’s smaller, more rural hospitals, with free care up to 200% of the federal poverty level and discounted care up to 400%.

Under the medical financial assistance law, hospitals are required to:

  • Provide notice of the availability of financial assistance both verbally and in writing;
  • Screen patients for eligibility before attempting to collect payment, and;
  • Only require patients to provide one income-related document to prove eligibility for financial assistance.

If a patient appears to be eligible for financial assistance, hospitals must suspend any collection attempts and give the patient a reasonable opportunity to apply.

For more information about Washington’s medical financial assistance law, including tools to see if you qualify, visit affordablehospital.wa.gov.


Washington’s Attorney General serves the people and the state of Washington. As the state’s largest law firm, the Attorney General’s Office provides legal representation to every state agency, board, and commission in Washington. Additionally, the Office serves the people directly by enforcing consumer protection, civil rights, and environmental protection laws. The Office also prosecutes elder abuse, Medicaid fraud, and handles sexually violent predator cases in 38 of Washington’s 39 counties. Visit www.atg.wa.gov to learn more.

Media Contact:

Brionna Aho, Communications Director, (360) 753-2727; Brionna.aho@atg.wa.gov

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