Debt collection is notoriously challenging, especially in the healthcare sector. There are ways to discourage late payments and improve payment rates, with practice, courage, and clear communication necessary to understand the issue and reduce associated problems.
Late payments come in lots of different flavors, with some patients paying off bills slowly, others going through financial difficulties, and a few never intending to make payments in the first place. It's important to differentiate between these cases and act accordingly.
Ideally, you want to help people who are facing genuine financial problems and identify those trying to play the system by acting quickly, calling a debt collection agency, and possibly considering litigation. When it comes to healthcare debt collection, it's important to stay determined and affirm your right to the money owed.
In the vast majority of cases, it's a good idea to start the process right away. You should send friendly bills and reminders when the amount is due or past-due rather than waiting until the end of the month or billing cycle. Debt can have a snowball effect on a business, which is why you should act fast by tightening up profit leaks before they get out of control.
At the end of the day, successful debt collection is about finding the perfect balance between friendly communication and professional assertive delivery. Getting this balance can be tricky, which is why so many people choose to use the services of a debt collection agency.
If you need to use an external agency, it's important to note that debt collection agencies are regulated through the Fair Debt Collection Practices Act.
The following tips can help you to avoid harassment, ensure compliance, and improve your response rates:
- Be friendly - Good customer service is always the best policy, both legally and from a business perspective. It's important to avoid harassment or you may end up in hot water.
- Stay on point - Stay on message by being concise but formal at all times. Remain clear about payment obligations while staying calm and avoiding emotional and personal conversations.
- Letters are crucial - The letters you write to late-paying patients are called demand letters, and they need to be saved for proof of contact. Professional collection agencies specialize in writing great demand letters, typically as a series that escalates in intensity.
- Offer to settle - Settling for less money than is due is a common strategy when you're dealing with patients who have no hope of paying the debt in full. This settlement needs to be made official in an appropriate legal document.
- Get extra help - Debt collection agencies offer a necessary service, but it comes at a price. While they may charge up to 50 percent of what they collect, some money is often better than none. It's always important to review collection agency ratings and reviews to find a company you can trust.
- Use the legal system - Depending on your location, you may be able to utilize the small claims court to get money owed. This is very popular and can be relatively inexpensive for small businesses. When small claims is not an option, you may have to file a lawsuit to recover the debt. However, this option does come with additional legal fees and court costs.
Get legal help for your business debt needs
If you're struggling to collect outstanding debts from patients, it can have a serious impact on your ability to do business. Debt collection is a highly specialized field that can be stressful and eat up valuable resources and time. Don't let unpaid bills put pressure on your business - talk to a healthcare collection agency today.