By: Healthcare Financial Management
The collection service evaluation checklist is designed to
help providers prepare a request for proposal,
ensure that the collection service meets their requirements
and cost allocations, and provide criteria to compare collection services.
The checklist is taken from How to Select a Collection
Service, a flyer developed by the American Medical Association and Cash Flow Solutions,Inc.
Although this tool is directed to physician practices,
it is useful for all healthcare providers.
The flyer is a companion piece to the American Medical
Association's claims management resource kit.
Additional resources can be found online at
www.ama-assn.org/go/psa.
Collection Service Requirements
[] How many years has the service been in business?
[] How many clients does the service support? Does the service
belong to any trade and/or community associations?
[] Is the service in strict compliance with the Fair Debt
Collection Practices Act and other federal or state regulations?
[] What is the service's philosophy toward collections? Does
it approach patients with the intent to maintain your practice's business relationship with
them?
[] What collection policies and standards will the service
apply in its efforts to collect your debt? How does the agency handle patient disputes of the
debt?
Licensing and Bonding Laws
[] Is the service licensed and bonded in your state and other
states as required by law? Can the agency provide copies of its licenses and bonds? If the service
is not licensed in other states, which service(s) does it refer accounts to when debtors may have
moved?
[] Does the service have "errors and omissions" liability
insurance to protect the service and your practice from any errors made by the agency? Be sure to
request that your practice be placed on the service's insurance policy documents.
[] Does the service maintain a separate trust account for
payments made to give its clients financial security, protection, and peace of mind?
Compliance Program
[] Does the service staff strictly adhere to all laws
governing collections, such as the federal FDCPA, which limits the times of day when agencies can
contact individuals to communicate about delinquent accounts? The FDCPA also requires certain
detailed information to be communicated to debtors when attempting to collect a debt.
[] Is the service up to date with the Fair Credit Reporting
Act?
[] Has the service and/or any of its clients (creditors) been
found liable in any litigation as a result of violations of the FDCPA or FCBA--for instance,
wrongful actions such as harassment, libel, slander, invasion of privacy, or interference with
business?
[] What is the service's record of complaints by patients,
health plans, and clients?
[] What policies and procedures have been adopted to comply
with the Health Insurance Portability and Accountability Act?
[] Will the service provide copies of its collection letters
to allow your attorney to make sure the service is in compliance?
[] Does the service have a full-time in-house attorney?
[] When does the service stop collection efforts and refer to
an attorney for legal action?
[] What increase in collection fees is applied once an account
is referred to legal action?
Staff Qualifications
[] Who will be handling the collection of the practice's
outstanding accounts, and what are the collectors' qualifications?
[] Are the collectors experienced in medical collections and
knowledgeable in medical terminology and insurance requirements?
[] Will you be able to speak directly with the collectors
handling your account?
[] What resources do the collectors have to locate debtors'
current address, telephone numbers and hidden assets? Do they have access to credit reports Uniform
Commercial Code filings, judgment recordings, and bankruptcy filings? You may wish to test these
skills by asking the assigned collectors if they are able to obtain your home address, telephone
number, and Social Security number.
Technology Resources and Flexibility of Services
[] Does the collection service utilize telephone collections
or only provide letter-writing services?
[] How does the service require placement of accounts for
collection by your practice (e.g., paper via mail or fax, disk, tape, online, etc.)? What are the
rates for each placement?
[] How and when are the status reports of the practice's
accounts received by the collection service (e.g., mail, fax, phone, Internet access, weekly,
biweekly, or monthly)? Are these reports included in the collection fee?
[] Does the service use a predictive dialer (e.g., automated
telephone dialer system) with generic prerecorded messages? These types of calls may be mistaken as
a sales solicitation and usually are ineffective and go unanswered.
[] Does the service report uncollected and collected debt to
all of the major credit bureaus and relevant state agencies?
[] Will the service customize a collection program (e.g.,
letters, telephone scripts, reports, etc.) to handle your practice's specific problems?
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