In The News

Cool, Calm and Collected

Joel R. Marchiano*

Selecting a collection agency – or evaluating the one you have – can improve bottom line results while maintaining your professional image. This article provides criteria for choosing a prospective collection agency and evaluating the strategies a collection agency employs, and discusses what a client medical practice should expect in analysis and support.

Key words: Collections; accounts receivable; Fair Debt Collection Practices Act.

Properly insisting on amounts due after your billing efforts have failed enhances your practice’s profitability and keeps costs down for patients who routinely meet their responsibilities. The challenge, though, is finding a post-billing collection agency that reflects your professional profile. Here’s what to look for in a company so that you can balance effectiveness and image.

COLLECTION AGENCIES: WHO THEY ARE

When determining the profile of prospective collection agencies, consider the following criteria:

Number of years in business: You want to deal with an organization that’s stable and has a good reputation. Usually, if a company has been around awhile, you can expect it to be around a while longer. Anyone can go into business, but to stay in business, an entity must be effective and continually satisfy its clients. It’s nice to give upstarts a break, but it’s smart to put your receivables in the hands of professionals with a proven track record.
Verifiable clients as references: Success in one type of collection activity is not always a guarantee in another. Ask for and check out medical references within specific fields. If you are told that the client list is “confidential,” you’re looking at a bright-red warning flag. You have a right to ask a company’s references whether they’re satisfied with the agency’s results, and whether the agency is easy to deal with.
Insured, bonded and licensed: Requirements for these vary from state to state, from totally unregulated to completely restricted. An experienced agency will know the requirements of your state and be able to document its compliance.
Experience and maturity of principals and key employees: Meet or call individuals who actively run the business and collection activities, and make sure they can describe the collection process and answer questions unique to your business. If the collection officer or manager does not know the difference between the technical and professional components of a medical bill, keep looking. Use your experience to evaluate their experience and trust your instincts.
Efficient and professional-looking workplace: We’ve seen agency workplaces ranging from “kitchen table” operations to modern high-tech environments. When possible, visit the agency as part of your investigation. If a visit isn’t practical, ask for pictures or send an emissary who lives near the candidate agency. Usually you can determine at a glance whether a workplace at least looks efficient and professional. It surprises us how many clients blindly enter into business relationships.

COLLECTION AGENCIES: HOW THEY DO IT

You should also determine a prospective company’s modus operandi. Here’s a check list of what to investigate:

Customized collection strategies: Ask for specifics. At what balance level is there a “letter only” procedure? When are the telephone calls deemed effective? What is the frequency of the letters and telephone calls? Timing should shift with the size of the balance and large balance strategies. Are collectors knowledgeable people who understand the medical business and have the ability to sympathetically overcome objections with effective rebuttals?
Rebilling and insurance follow up: Despite your best efforts, certain patients will not furnish you with the correct information to submit an insurance claim. Frequently, these individuals will make the effort to resolve matters when they hear from a collection agency. Make sure any agency you are considering has procedures in place to deal with these issues.
Expert knowledge of FDCPA: The Fair Debt Collection Practices Act (FDCPA) is the legislation that regulates collection agencies and others in the collection industry. The agency must assure you that all of its people are trained in FDCPA regulations and an active program exists to ensure compliance. Documents should be available as proof of these activities. The agency should also be able to answer any questions on your in-house efforts. Additionally, the agency should be willing to place a “hold harmless” clause in its contract with you, giving it responsibility for any lawsuits against you resulting from its activities.
Knowledge of the medical field: Whether it’s anesthesia, surgery, OB/GYN, radiology, etc., collection personnel should not be surprised by any medical terminology introduced by the patient in the course of a collection conversation. The agency should be able to explain the service rendered and how the bill came to be.
Quality of correspondence: Collection letters and other documents from the agency should be professional looking, effective and legally compliant. The quality of the printing and paper stock should have a subtle but significant effect on patient responses. Unprofessional looking letters are less effective and reflect poorly on your practice.
Computer technology: The agency’s computer system should fully support the efforts of the collectors. Features such as online credit bureau inquiries and motor vehicle department searches should be demonstrated. In addition, collection procedures should be fully automated and paperless, and accounts should be prioritized and routed to collectors by management driven priorities. The agency should also demonstrate systems controls and eliminate overlooked accounts, missed follow up dates, out of schedule conditions, etc.

COLLECTION AGENCIES: WHAT TO EXPECT

Finally, you’ll want a clear idea of what to expect from an agency. Use this list below as a guide:

Reports that meet your needs: You should expect placement confirmation, account status reports, inventories, and remittance statements to be clear, timely and easy to understand.
Prompt monthly remittance: Your agency should be willing to commit to a schedule of regular monthly remittances. Each payment should be reported with name, agency account number, date of payment receipt, the commission rate, and the apportionment of each payment to client and agency.
Periodic analysis: Request examples of the agency’s self-examination that it is willing to share with you. Insist on key data such as percentage of collections to placements both cumulative and by month of placement. The agency’s ability to make collection forecasts and projections also indicates that it has a strong grasp of its business.
Easy communication: When you have a question, the agency should respond immediately. In addition, you should have direct access to supervisors, managers and officers of the agency. The agency should also exercise good judgment in determining the level at which you need to communicate.
In-house support: An agency should be willing to support your in-house collection efforts even if such support could reduce its future placements. Also look for an agency that offers news bulletins, training material, seminars and in-house evaluations.

Overall, be sure to find a company that delivers results and matches the image you want to project. By doing so, you’ll be cool; calm; and, best yet, collected.

*CEO, C.Tech Collections, Inc. 5505 Nesconset Hwy Suite 200 Mt. Sinai, NY 11766
Phone: 866-402-1027 Fax: 631-331-9566 marketing@ctech-collects.com
www.ctech-collects.com

Our Services Include:

Maintaining good will, as well as your business or practice integrity.
Providing placement confirmations, Status Reports and Remittance Statements in a timely manner.
Skip Tracing, DMV, Internet Searches and Reporting to the Credit Bureau at no additional cost.
Full compliance with FDCPA, HIPAA and all federal, state and local collection statutes.

Latest News:

C.Tech Collections is involved in the following:

Port Jefferson Chamber of Commerce

Le Tip Community Merchants Group

HIA Hauppauge Industrial Association

NESPA Northeast Spa & Pool Association

ASA Conference on Practice Management
Atlanta Marriott Marquis, Atlanta GA
January 29 - 31, 2010 Booth # 210
The Anesthesia Billing & Management Seminar
Caesar's Palace, Las Vegas, NV
April 17 - 19, 2010
MGMA Anesthesia Administration Assembly (AAA) Conference
Grand Hyatt, San Antonio, TX
May 23 - 26, 2010 Booth # 204
AHRA 2010 Annual Meeting
Gaylord National Resort & Convention Center, Washington DC
August 22 - 26, 2010
Booth #203

Joel Marchiano, CEO, C.Tech Collections will be presenting, "Improving the Profitability of Your Practice" Sunday, August 22, 2010, 4:30pm - 5:30 pm
Together we make a difference .... Breast Cancer Fund Raiser at Danfords Restaurant & Marina Port Jefferson NY on Friday August 20, 2010 from 6:00 - 8:00 pm. Entrance fee of $35 per person includes: buffet, DJ, half-priced drinks and no charge for Aqua for those participating in the charity. Raffle tickets will be available for baskets, a 50/50 drawing, as well as an opportunity to win an Overnight Stay at Danfords ($300 value). Please RSVP 631-828-3150.

All proceeds from this event will benefit John T. Mather Memorial Hospital's 14th Annual Breast Cancer Victory Day to be held on Saturday, September 25, 2010 beginning at 12 noon. This event is designed as a celebration of life and remembrance for all those whose lives have been touched by breast cancer.