September 22, 2014
Author: , Esq.
With changes to laws and practices that see trends toward high deductibles or more copays, healthcare providers are finding themselves more and more in the position of having outstanding invoices. Healthcare providers need to be very careful and plan ahead to ease its efforts in collecting delinquent payments. First, providers need to educate and notify its patients of payment expectations, what result will be if payments are not made timely such as interest or penalties, and if attorney fees incurred for actions to collect late payments will be added as well as what legal actions may be taken.
Providers need to carefully consider what collection efforts, if any, they should take. It is important to understand that medical bills are considered consumer debts which consist of personal, family and/or household debts. The fact that medical bills are consumer debts places special restrictions on efforts to collect these debts. State laws may have special restrictions. For instance, under the Iowa Consumer Credit Code, a party collecting its own debt is a debt collector and therefore must follow the collection practices cited in the Code. See Iowa Code Sections 537.7102 and 537.7103. On another level, the Fair Debt Collection Practices Act also governs collectors of consumer debts.
A final concern I would raise is for providers to carefully consider and identify outside collection agents and to fully understand the collection efforts and practices utilized. Once hired, these collection agents act on behalf of the provider and thus, the collection efforts of these agents reflect back on to the providers in a positive or negative way.
