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Dispelling Collection Myths

25 May

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ACA (American Collectors Association) International seeks to dispel commonly held myths about the credit and collections industry. Today more than 30 million consumers have delinquent or defaulted accounts under collection, averaging $1,400 each.

“Repayment of consumer debt is the lifeblood of America’s credit-based system and vitally important to the national and state economies,” ACA International Chief Executive Officer Pat Morris said. “It helps ensure that affordable credit is available, goods and services remain affordable, sustains jobs and supports keeping taxes low.”

As an industry, third-party debt collectors help employ more than 300,000 people, pay nearly $2 billion in federal, state and local taxes, donate $85 million and volunteer 650,000 hours to charitable organizations in local communities. “Whether a small town hospital, business or a city struggling to recover taxpayer owed dollars, organizations large and small rely on the recovery of rightfully owed consumer debt,” Morris said.

Myth 1: Avoiding a Debt Collector Makes the Debt Go Away. Consumers who ask debt collectors to stop contact or choose not to respond to calls or letters often mistakenly believe it means their debt has been eliminated. Avoiding contact will not erase a debt. Instead, consumers should communicate with collectors to discuss the account, verify its accuracy and work on a plan for resolution. If consumers don’t owe the debt, communicating with collectors can help put a stop to calls or letters.

Myth 2: Consumers Don’t Have Rights in the Recovery of Past Due Accounts. The collection of consumer debt is one of the most heavily regulated industries in the United States. Consumers have important rights under a number of federal and state laws. For more information about what to do if contacted by a debt collector please visit http://www.askdoctordebt.org.

Myth 3: All Debt Collectors are Bad. Just as “all consumers” aren’t the same, neither are all debt collectors. Most are committed to professionalism, training and customer service. When it comes to the “bad guys,” we want to put them out of business just as consumers do. ACA International and its members continue to work with state and federal policymakers, regulators, courts and attorneys general to comply with the law and hold accountable those who do not.

Myth 4: It is Boom Time for Debt Collectors. It’s no secret that consumers have struggled financially in the current economy. Despite an increase in defaults and delinquency, the inability of consumers to repay rightfully owed debts trickles down to those charged with their recovery.

© 2012 ACA International. All Rights Reserved. Reprinted with the express written permission of ACA International

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Top 10 Tips to Improve Collections (Part 9)`

22 May

It’s a problem faced by virtually every business and medical practice – how to deal with customers / patients who pay their bill late, or not at all.  While customers and patients expect prompt and professional service, they don’t always meet the same standard when it comes to paying their bill.

Accounts not paid promptly can severely impact the cash flow of a business or practice.  A clearly defined and carefully communicated, yet diplomatic payment policy, may help avoid difficult collections situations.

Tip #9

USE A THIRD PARTY EARLIER IN THE PROCESS

Most businesses/practices have trouble keeping up with laws regarding contacting customers/patients regarding their accounts.  Even if they can stay informed enough to ensure their compliance, the additional challenges that the regulations cause means that tactics must change.  In order to collect the accounts, more frequent contacts are necessary (see tip #4).  In a difficult economy, most businesses/practices can not afford to hire the additional staff necessary to effectively and systematically collect before accounts age to oblivion.

Services are available that will accomplish the “in-house” follow up necessary to collect accounts early, while ensuring complete compliance to privacy and collection laws.  These services, like Transworld Systems Accelerator,  can actually save the business/practice the internal expenses of doing their own follow-up at avery reasonable price, and without alienating customers/patients.

By the time an account reaches 60-90 days past due, the customer/patient is sending a message.  They either do not intend to pay, or are waiting to see what the business/practice will do to demonstrate their commitment to getting the account paid.  At that point, a third party can motivate a customer/patient to pay in ways that the business/practice cannot, simply because the demand for payment is coming for someone other than your business/practice.  Avoid paying a percentage to a contingency collection agency, using small claims court or hiring an attorney by using a flat-fee collection service such as Transworld Systems Profit Recovery.  Using Transworld Systems Profit Recovery can save your business/practice both time and money, without having to pay a high percentage of any money collected.

For more information on the suite of services that Transworld Systems has available to make businesses and medical practices more profitable, while maintaining good customer/patient relationships, please contact me through the form below or follow this blog for regular updates.

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Top 10 Tips To Improve Collections (Part 7)

16 May

It’s a problem faced by virtually every business and medical practice – how to deal with customers / patients who pay their bill late, or not at all.  While customers and patients expect prompt and professional service, they don’t always meet the same standard when it comes to paying their bill.

Accounts not paid promptly can severely impact the cash flow of a business or practice.  A clearly defined and carefully communicated, yet diplomatic payment policy, may help avoid difficult collections situations.

Tip #7

ADMIT AND CORRECT ANY MISTAKES ON YOUR PART

Sometimes customers/patients don’t pay your bill because they think your business/practice has made a billing error.  If that is the case, quickly admit it and correct the error.  Generally, customers/patients realize that mistakes happen sometimes in business.  Unfortunately, some customers/patients believe that the owner/president or doctor “doesn’t need the money.”  Denying an obvious error your part only feeds the fire of resentment your customers/patients already feel.

To receive each of these 10 tips by email, please follow this blog by entering your email address on the right side of the page.

 

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Top 10 Tips To Improve Collections (Part 6)

14 May

It’s a problem faced by virtually every business and medical practice – how to deal with customers / patients who pay their bill late, or not at all.  While customers and patients expect prompt and professional service, they don’t always meet the same standard when it comes to paying their bill.

Accounts not paid promptly can severely impact the cash flow of a business or practice.  A clearly defined and carefully communicated, yet diplomatic payment policy, may help avoid difficult collections situations.

Tip #6

MAKE SURE YOUR STAFF IS WELL TRAINED

Even “experienced” staff members can sometimes become jaded when dealing with past-due accounts.  This usually happens when the customer/patient has made and broken promises for payment.  Make sure the staff is firm, yet courteous when dealing with them.  Your business’s/practice’s collection staff may benefit from customer service training because, in effect, they must “sell” your customer/patient on the idea that your business/practice expects to be paid.  Make sure that your staff is trained to not only bring the account current, but to also maintain good will.

Contact me if you would like information on training for your staff in customer relations and asking for money.  The consultation is free.

To receive each of these 10 tips by email, please follow this blog by entering your email address on the right side of the page.

 

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4 Lessons Small Businesses Can Learn from Warren Buffett

14 May

4 Lessons Small Businesses Can Learn from Warren Buffett.

Top 10 Tips To Improve Collections (Part 5)

13 May

It’s a problem faced by virtually every business and medical practice – how to deal with customers / patients who pay their bill late, or not at all.  While customers and patients expect prompt and professional service, they don’t always meet the same standard when it comes to paying their bill.

Accounts not paid promptly can severely impact the cash flow of a business or practice.  A clearly defined and carefully communicated, yet diplomatic payment policy, may help avoid difficult collections situations.

Tip #5

USE YOUR AGING SHEET, NOT YOUR FEELINGS

Many businesses/practices (or some well-meaning people on their staff) have let an account age beyond the point of ever being collected because he or she “felt” the customer would pay eventually, and did not want to offend or alienate the customer/patient.  While there are certainly isolated cases of unusual situations, the truth is that if your business/practice is not being paid, someone else probably is.  So stick with your systematic plan of following-up on slow pay and delinquent accounts.  If it is done systematically and early in the process, it will soon be apparent who intends to really pay and who doesn’t.  Appropriate action can and should be taken once you know where your business/practice stands.

Contact me if you would like information on ways to get this accomplished in your own situation.  The consultation is free.

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Top 10 Tips To Improve Collections (Part 4)

12 May

It’s a problem faced by virtually every business and medical practice – how to deal with customers / patients who pay their bill late, or not at all.  While customers and patients expect prompt and professional service, they don’t always meet the same standard when it comes to paying their bill.

Accounts not paid promptly can severely impact the cash flow of a business or practice.  A clearly defined and carefully communicated, yet diplomatic payment policy, may help avoid difficult collections situations.

Tip #4

CONTACT OVERDUE ACCOUNTS MORE FREQUENTLY

No law says your business/practice can contact a customer/patient only once a month.  The old adage, “The squeaky wheel gets the grease” has a great deal of merit when it comes to collecting slow pay and delinquent accounts.  Contacting late payers every 7-14 days will enable you to diplomatically remind the customer/patient of your terms of payment.

If recent economic conditions have made it impossible, due to reduced or inadequate staffing levels, to make contacts that frequently, never fear.  What used to be a benefit that only the largest companies/practices could afford, there are now VERY inexpensive services available that will do the contacting for you, in your name.  This accomplishes the level of frequency you need, without spending more money (often even less) than it would cost you to do the contacting in-house.

For more information on services that are available to increase the frequency and effectiveness of account follow-up, please contact me personally.

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More Evidence Of The Importance of Compliance. Kaiser Permanente joins a growing list of companies sued for non-compliance.

11 May

“Law360, New York (April 26, 2013, 2:06 PM ET) — Kaiser Permanente was hit Wednesday with a proposed class action that accuses the health care organization of violating consumer privacy and the Telephone Consumer Protection Act by calling a former California customer’s cellphone without consent.

Plaintiff Rafael David Sherman alleges that Kaiser sent an unsolicited automated message to his cellphone April 23, three months after Sherman canceled his health insurance coverage with the Kaiser Foundation Health Plan Inc., according to the complaint filed in the Southern District of California. Kaiser used an automatic dialing system to contact the plaintiff …”

 

Compliance is important, and knowing how to be compliant with all of the laws that govern contact with cusomters/patients, the follow-up of accounts and collections is getting tougher and tougher.  All the more reason to have a partner that will ensure that you stay compliant.

For more information on keeping your business or medical/dental practice compliant with not only HIPAA, but also the TCPA and the FDCPA and other state and local regulations, please contact me.  I’d be happy to help keep you out of court.

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Are You Asking The Right Questions?

9 May

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It is always important to ask questions, especially if you are not 100% certain of the subject matter you are discussing. This is even more important when selecting a company to recover your late payments and call upon people that are delinquent on their accounts. It is paramount to ensure your company of choice is expert in their field.

Today with the ever changing Federal and State regulations, it is more important now than ever to ask questions first before you have to answer for shortcuts or missteps that could result in hefty fines for lack of compliance with the letter of the law.

The next time you talk to a potential collection or debt agency be sure to have the following questions close by so you are not hit with Federal and State regulations later.

1. Is your company compliant with TCPA, HIPAA and familiar with state laws regarding compliancy?
Yes. In fact, Transworld Systems is compliant in all 50 states as well as having a Hold Harmless Statement in our agreement with clients.

2. Does your company perform background checks on collectors in required states?
Yes. We perform background checks on collectors in ALL states.

3. How are cell-phone calls handled?
Rules governing cell phones are complex and change frequently. You want a collections agency that is willing to give you a Hold Harmless Agreement.

4. What is a Hold Harmless Agreement?
Simply put, a Hold Harmless Agreement is an agreement or contract in which one party agrees to hold the other free from the responsibility for any liability or damage that might arise out of the transaction involved.

5. Do you know what PHI is?
Yes. PHI is Protected Healthcare Information. It includes any information about health status, provision of healthcare and payment for healthcare that can be linked to an individual. Be sure the company you choose ensures the security of that information.

6. Is your company licensed to collect in all states?
Yes. If you are billing regional, national or transient customers, it is important that your collections resource can legally collect in the states where your debtors reside.

Contact me for more ways to know if your collection agency will keep you protected from liability and potential penalty.

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Top 10 Tips To Improve Collections (Part 3)

8 May

It’s a problem faced by virtually every business and medical practice – how to deal with customers / patients who pay their bill late, or not at all.  While customers and patients expect prompt and professional service, they don’t always meet the same standard when it comes to paying their bill.

Accounts not paid promptly can severely impact the cash flow of a business or practice.  A clearly defined and carefully communicated, yet diplomatic payment policy, may help avoid difficult collections situations.

Tip #3

USE “ADDRESS SERVICE REQUESTED”

One of the most difficult collection problems is tracking down a customer/patient who has “skipped” — or moved without informing your business of the new address.  The U.S. Postal Service has a procedure to address this situation.  Any statement or correspondence sent from your office should have the words “ADDRESS SERVICE REQUESTED” printed or stamped on the envelope, just below your return address in the upper left hand corner.

If a statement  or invoice is sent to a customer/patient who has moved and the words “ADDRESS SERVICE REQUESTED” appear on the business’s envelope, the Post Office will research this information.  If they can locate a change of address for that person, they will send you business Form #3547 with the correct new address for a small fee.  This can help keep your address file up to date and eliminate many of your items being returned marked “Forwarding Order Expired,” and leaving you (and your A/R) in the lurch.

To receive the rest of these tips by email, follow this blog in the right hand column.

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