To avoid confusion, misrepresentation, and excessive contacts, providers and their collection partners should exercise caution to ensure only one entity is collecting on an account at a time.
When forwarding an account for collection, health care providers should cease internal collection efforts and refrain from placing the account simultaneously with multiple collection partners.
If more than one entity attempts to collect a debt at the same time, the consumer may become confused as to which entity is actually collecting the debt and who to contact for payment, complaints or other inquiries. Additionally, payments made on the account will likely be credited only with the entity that received payment rather than with all parties collecting on the account, leading to inaccurate account balances.
The amount of the debt may also vary depending on collection costs—as collection costs added to outstanding account balances are presumably different between agencies and a collection agency may be seeking collection costs while the provider is not. Consequently, if more than one entity at a time collects an account (either multiple collection agencies or a collection agency and a provider), a misrepresentation of the debt is bound to occur, as payments may not be credited by all the parties seeking collection and the amount owed may be different at each agency.
Further, a consumer will likely be contacted more frequently when multiple parties are attempting to collect on the same debt, which could frustrate or irritate the consumer. Such actions could also result in violations of the Fair Debt Collection Practices Act, which governs the practices of most third-party debt collectors.
Written by Pulse
For more information, please contact David Brooks via email at firstname.lastname@example.org or by phone at (949) 900-6125 x205