Debt Recovery

 

Every year several students fail to pay their tuition fees. Additional charges may include room and board fees, library dues and more. Colleges need this money for daily operations, plus they cannot set a negative precedent for other students who have been paying their tuition fees on time till now.

Specialized collection agencies adept in university debt recovery are well-versed in legal debt collection aspects, ensuring ethical and lawful methods. These agencies achieve higher recovery rates than college internal staff. Outsourcing accounts receivable to a  collection agency allows college accounting teams, often short-staffed, to focus on their core responsibilities.

During the collections process, collection agencies can also instruct students to complete their Federal Student Aid (FAFSA) documentation, potentially helping them pay off their student loans. The University CFO/Bursar plays a crucial role in maintaining the financial health of the institution, they can rely on collection agencies to perform appropriate recovery services for active and inactive students.

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Your collection agency should be able to rightfully advise on how their collection strategy will work so that:

• Existing students should not drop out fearing collections the collection strategy should encourage them to complete their course while making payments gradually.
• Remember that many students may have Pell Grants or other federal aid covering nearly 90% of their tuition. Therefore a careful diplomatic approach is essential for active students.
• Explain to students that if they drop out, the government will not cover any tuition they may qualify for, and the student will be fully liable for all fees incurred. However, if they re-enroll and complete the course, they will be on the hook for the 10% payment only and the government will pay the remaining 90%. Therefore a collections agency can even encourage several inactive students to re-enroll.
• The collections approach can be more intensive for students who have completed the course or have become permanently inactive.
• College staff is always understaffed, so the collections approach should reduce their burden and work as a seamless extension of their accounting staff.

Collection agencies for colleges have in-depth industry-specific knowledge. They ensure the college’s reputation is not tarnished during the collection process. Old university debt is often considered gold because the ability of individuals to serve their student debt gets better. They gradually settle in life and start earning more money. Assigning old accounts to a professional debt collector is always smart, resulting in high recovery rates for the institutions.

Diplomacy is essential in the debt-recovery process for universities, even if they collect only on inactive students. To maximize its federal aid, the university must have a sound collection process in place. A hybrid debt-recovery program designed for educational institutions will not only recover money from existing and ex-students but also help re-enroll students who have dropped a semester.

It is important that universities must hold students accountable for their financial obligations. Doing so helps nurture personal responsibility and financial planning and allows universities to provide the best learning possible. Here is how universities can responsibly use a debt collection agency to deal with past-due accounts.

Types of Debts for Colleges and Universities

Universities are complex institutions that have many financial aspects involved. Unlike most businesses where accounts receivables are for a single or small group of products or services, the types of debt college students may owe to a university are diverse and wide-ranging. These debts that sometimes go unpaid can include but are not limited to things such as:

• Tuition Fees
• Student housing charges
• Meal plans
• Library charges
• On-campus violations
• Administration fees
• And more

When these debts to universities go unpaid, it is vital to collect as much of the owed money as possible and in as timely a manner as possible. The university must collect to operate and students must fulfill their financial obligations.

Tools to Collect Student Debt

When student tuition or other accounts go past due, the university has several tools to help collect the debt. The university can stop the students from continuing at the school or prevent them from benefiting from the time spent at the school. To do this, the school may withhold grades, transcripts, or degree certification, prevent the student from registering for future classes or bar the student from the university entirely. Once an account goes past a certain point (usually 30, 60, or 90 days), it is best for universities to turn the account over to debt-collection professionals if they hope to recover any money. English, Spanish and Mandarin debt collectors are required for university debt collections.

Collection Demands Service

The upfront cost for 5 Collection Letters is about $15 per account. Debtors pay directly to you with no other fees. Low-cost option. Good for accounts less than 120 days past due.

Collection Calls Service

Contingency fee only. No upfront or other fees. Agency gets paid a portion of the money they recover.  No recovery-No fees. Best for accounts over 120 days. A debt collector calls a debtor many times. If everything fails, a possible Legal Suit is recommended by the attorney.

Working with a University Debt Collection Agency 

How and when you turn a student’s unpaid debt over to a university debt collection agency will vary by institution and location. While private universities have more leeway, many states have specific rules about transferring student debt for collection. For example, any debt 60 days past due in Virginia and under $3,000 may be handed over to a private debt collection company. Any similar debt over $3,000 must be sent to the state attorney general’s office for collection. An experienced university debt collection company will know all these specific rules and regulations and help you work out how each account should be handled.

When a university does transfer education accounts receivables to a university debt collection agency to recover unpaid charges, the agency can also help guide you toward the best financial options for the institution. Again, depending on the type of college or university and the local laws, the institution may be able to protect itself financially and collect the debt at little to no cost by assessing penalties, interest and collection agency fees to the original amount of the account.

A university debt collection agency will have experience working with educational debt and know the best ways to settle these debts that will benefit the institution and the student. They will be able to advise schools on local regulations and help ensure the debt is collected as quickly as possible.

Conclusion 

Institutions of higher education such as colleges and universities, are in a unique position when it comes to debt collection. Like any organization, they need to collect money owed to preserve financial health and also do it in a way that is responsible to their mission of providing life lessons and experience to their students. An experienced university debt collection agency can help schools collect debts in the right way so universities can achieve all their goals.

Commercial debt collection or B2B collection involves two business entities, one of which owes money to another.

We can recover your outstanding invoices quickly, professionally, and without harming your business relationships. By using techniques like soft collections, skip tracing tools, credit bureau leverage, expert negotiation, legal network access, and third-party pressure, we tailor our recovery approach to fit your industry, debtor profile, and age of the debt—because effective collections are never one-size-fits-all. Majority of cases are resolved without the need for court involvement.

Our success rate in commercial collections is quite impressive. Most accounts that are less than one year old see an average recovery rate of approximately 80% on viable claims ( Less than 1 year old, and proper supporting documentation provided). 

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The longer you wait, the more likely it is that the business may no longer have the ability to pay you. Working with an experienced B2B collection agency increases the chances of preserving a positive client relationship while helping you avoid the high costs of litigation and enforcing a judgment.

Our Commercial Debt Collection Methodology

• No Recovery – No Fee: If a commercial collection agency work on a contingency fee model, means if it does not recover money for you, they will not make any money either.
• Documentation and Primary Contacts: Apart from the core documentation, you may have emails or phone recordings in which the debtor could have acknowledged the debt. Tell your collection agency precisely who you think should be reached out to resolve this debt.
• Customized Strategy for Each case: An experienced commercial debt collector will analyze your case and develop a custom collection strategy. He will call your defaulter and get him talking. The collector may even email, fax,message or send certified mail to get your debtor’s attention. They explain all the consequences of not settling the debt.
• Initiation: Talk to client and identify the actual cause of non-payment and devise a plan for payment. The collector will decide the optimal time and contact for calls or emails, and will judiciously escalate pressure as needed. If a client blocks one number, call is made from a different number. A commercial collector employs various strategies to expedite debt recovery.
• An aggressive approach usually does not work: A well-planned diplomatic approach protects the business relationship,  your debtor is approached with dignity and respect. A well-calculated intensive approach can be used later to resolve debts if your debtor does not cooperate with us.
• Send Legal Notice: If all amicable collection efforts fail, a notice may be sent through an attorney (in-house lawyer or a partner law firm). This puts tremendous pressure on your debtor to settle the debt.
• Final chance to settle: Most cases are settled even before a case is filed in court. Legal action is pursued only after written authorization from you.
• Final Negotiation: If the debtor proposes a settlement offer lower than the original amount due, it is accepted only after your approval ( also known as Settle-in-Full authorization).
• Court Order and Enforcement: Once a favorable judgement is achieved, we take several actions to enforce it and get paid.  The collected amount (minus the contingency fees) is remitted into your bank account via ACH transfer or by mailing a check.
• Credit Reporting: Just like individuals, businesses also have credit scores. Commercial collection agencies can report debts to business credit bureaus ( ex: Moody’s Experian and Dun & Bradstreet). This can impact a business’s future ability to obtain loans and business prospects.
• Duration: Most cases are resolved within 40-45 days. However, some may last for a few months if a court order is required. The commercial debt collector may also negotiate a payment plan if required.

Ongoing Checks: Commercial collection agencies use advanced tools to track significant changes to your debtor’s business credit profile. Debt collectors can find business owners’ alternate addresses and telephone numbers using skip-tracing tools. A commercial collection agency may also find a recent summary of your debtor’s payment activity with other creditors to further strategize their collection efforts.

Good News – There are no federal “Statute of Limitations” for commercial debt. 

Commercial Collection Agency Fees:

Commercial collection agencies have a low-cost contingency fee model; No recovery means No fee is charged. The collection fee for each case is communicated in advance and primarily depends on three factors: Age of debt, Balance Due, and Complexity. The contingency fee is usually between 20% and 40% of the collected amount. Accounts with lower balances or those older than one year have a slightly higher contingency fee. Here is a rough estimate of what a typical commercial collection agency fees are:

	Contingency fee (Based on Account Age and Amount Assigned)
Age < 90 days	25%	20%	15%	10%
90-180 days	30%	25%	20%	15%
180 days – 1 year	35%	30%	25%	20%
Age >1 year	40%	35%	30%	25%
Amount Assigned	$500- $5k	$5k- $20k	$20k- $100k	$100K +

Comparing Consumer (B2C)  vs Commercial (B2B) Collections

Consumer (B2C) collections focus on recovering debts from individual customers, often requiring a delicate, customer-centric approach. In contrast, Commercial (B2B) collections involve reclaiming debts from businesses, typically demanding a more formal, contract-based strategy.

When selecting a commercial collection agency, consider factors like their experience, success rate, tactics they use, whether they have proper licensing and accreditation, and reviews or references from other clients. All commercial agencies must follow the Uniform Commercial Code (UCC).

Legal and regulatory collection laws

Consumer debt collection is largely governed by federal laws, such as the Fair Debt Collection Practices Act (FDCPA), and some state regulations.

A commercial debt collection agency is entirely exempt from most of these laws because these laws aim to protect consumers than businesses.

As of April 15, 2022, CFPB Director Rohit Chopra hinted at the possibility of expanding FDCPA laws to commercial debt.

Relationships matter: Negotiate for better recovery.

Understanding your legal options thoroughly is crucial, but avoiding litigation is often the preferable course of action. Encouraging amicable discussions for settling debts can lead to more productive recovery outcomes, and may even preserve ongoing business relationships. If you find yourself dealing with a business customer who has overdue obligations, aim to steer clear of confrontational approaches. Instead, focus on collaborating to find a mutually beneficial solution to the problem.

Blurring the line between personal and commercial debt

A commercial collection agency has fewer restrictions; however, many commercial debts are backed by a personal guarantee. When the collections process moves to the enforcement stage, such as levying against bank accounts and other assets, you may be limited by the individual guarantor’s rights.

Printing and mailing services have been performing a crucial role in the American marketing industry. They run into overdue accounts receivable often, which can impact their business dearly. Maintaining a good business relationship with clients is as important as it is to recover money from unpaid bills. Unpaid bills can create severe cash flow for businesses. Once a bill is over 90 days past due, it must be sent for collections to prevent further losses.

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While almost every business has to deal with many of the same functions, each type of business goes about these functions in different ways. All businesses deal with things like sales, marketing, IT, finance, and more but, depending on your industry, the way you go about these aspects of business can be very different. The same applies to debt collection. The debt collection needs, rules, and regulations for printing and mailing service companies are unique to that specific industry and must be dealt with in certain ways. Here is what printing, signage and mailing service businesses need to know about debt collection.

Why Printers and Mailing Services Need Debt Collection 

The truth is almost all businesses will face situations where clients don’t pay in a timely manner, don’t pay in full, or don’t pay at all. For huge corporations, these outstanding balances can simply be absorbed and become tax write-offs. For small and midsize businesses (SMBs) the importance of collections is much greater.

For the printing and mail service industry, it is not uncommon to run into outstanding accounts receivable. It is an industry where many regular customers are extended credit on large printing runs or are billed monthly for quarterly for regular direct mail campaigns. Because of these scenarios, nearly every business will run into a situation where a client does not pay from time to time.

Commercial vs. Consumer Debt Collection 

 Printing and mailing service companies almost always deal directly with businesses or with customers using their services for activities that are “commercial in nature”. This means that to collect debts, companies in the printing and mailing service industry are not beholden to consumer debt collection laws.

The Fair Debt Collection Practices Act (FDCPA) protects consumers from unfair and overly aggressive debt collection practices such as excessive contact, threats, and additional fees. This only applies to B2C debt collection, not B2B debt collection. Because printing and mailing service businesses are dealing with business and business-like entities, these businesses enjoy much more leeway in how they can go about debt collection.

Just Because You Can, Doesn’t Mean You Should 

In some places, there is no law about texting while driving but that doesn’t make it any less safe or a better idea to do so. The same can be said about overly aggressive debt collection practices. While collecting a business debt you are allowed to call more often and at any time, make specific threats, and generally use most any tactic you can to get paid. While these practices may ultimately get the outstanding account paid, it may not be good for the long term health of your business.

Even though you are not bound by the FDCPA while collecting B2B debts, that doesn’t mean you shouldn’t abide by many of the tenets in that federal statute. It will help keep your good name as a business intact and maybe even allow you to keep a good customer even after having a payment issue. Some of the principles in the FDCPA to keep in mind are:

• Don’t call at unreasonable hours
• Don’t add unreasonable additional fees or interest that weren’t part of the original agreement
• Don’t broadcast the debt to the debtor’s customers or employees
• Lie about how much the debtor owes
• Don’t make false threats about suing or reporting the debtor or misrepresent yourself to intimidate the debtor

Let the Professionals Handle It 

The best way for printing and mail services businesses to make sure they are walking the fine line between making sure they get paid while simultaneously taking advantage of the relaxed B2B debt collection laws and not going too far, is to use a professional, ethical, experienced debt collection agency to help collect past due accounts. Commercial debt collection agencies will know exactly how aggressive they can be and how much they can push to get the debt settled. They will also know how to do this in a way that separates the collection practices form the company and keep your business relationships and reputation in good standing.

As a medical practice, you have dueling responsibilities. Your mandate is to provide patients with the best care possible but, as a business, you also need to look after your bottom line. The tough part is, sometimes these two things can seem like they are at odds with each other, especially when it comes time for collections. However, there are a few things you can do as a practice to help alleviate some of the stress that comes from patients dealing with medical bills. Here are 5 tips to help reduce patient stress in medical collections.

You Get More Bees with Honey 

Just because a patient is past due on their bill doesn’t mean customer service and patient relationships can go out the window. When medical bills are late and look like they might not be paid, it makes perfect sense that the first instinct is to get tough and aggressive in hopes of collecting. This is counterproductive in most situations though. Make sure the people in charge of collections within your practice offer the same level of customer service when collecting as they do in other patient interactions. It is the best way to collect in the end and still salvage the patient relationship.

Separate the Doctor and the Collector 

Once a debt goes past due and into collections, it can be hard to save the doctor/ patient relationship if the practice is the institution making the debt collection calls. By turning past due accounts over to a debt collection agency, you can keep your medical relationship and let someone else handle the financial relationship. Just make sure you work with a reputable, ethical, medical debt collection agency. While the relationships will be separate, a bad collection agency will ultimately reflect on your practice.

Be Upfront About It 

Patients are more likely to be stressed and less likely to avoid paying medical bills when they open up the mail and there is a bill with a huge, surprising number on it. When you discuss pricing and payment with patients upfront, there should be no surprising stress down the line. Also, knowing what something is going to cost will help a patient plan and budget for it so that when the bill comes, they are able to comfortably afford the payment.

Give Patients Payment Options 

Sure, credit card companies may charge an arm and a leg for processing fees and setting up and maintaining an online payment portal can be expensive, especially in the beginning but the more payment options you give patients, the more likely you will be to get paid. At the very least, you will never give patients the excuse to say that you don’t accept their preferred form of payment and they will not have to stress about not being able to pay the way they want.

Manage Process with Technology 

In some cases, past due bills are just as much the practice’s fault as it is the patients. If practices let medical bills go unpaid for 30, 60, or even 90 days without following up at regular intervals, it can be easy for patients to blow these bills off. Then, when the bill is officially past due, it can become an ugly situation. A good practice management software can help automate the collection process so that fewer patients get to the past due point.

Simplified Medical Statements

Sending multiple billing statements to the same patient for a series of visits and treatments can get very frustrating. To avoid confusion and rejection, use consolidation and simplification of your medical bills. Present them with one straightforward amount with a short breakup below. Your patients will be more comfortable paying the bill. This will also minimize any confusion and hostility.

Conclusion 

The truth of the matter is, in any business, there will be a certain, small percentage of clients who don’t pay or habitually pay late. The fact that medical billing is so specific and complicated aggravates this fact for medical practices. The good news is, by following these few simple tips, you will be able to not only increase your rate of debt collection but help reduce patient stress while doing it.

For more than 30 years, Compulink has helped medical practices everywhere run more effectively and efficiently so doctors, nurses, and medical professionals can focus on what matters most; patient care. Compulink medical software is a data-driven, all-in-one EHR and practice management software to help your medical practice improve your financial and clinical results. Here are some of the best features and benefits of Compulink Medical Software.

Are you already using Compulink Dental Software? Have unpaid medical bills?  Need to transfer your overdue accounts receivable to a debt collection agency? Contact us You decide what should be the minimum outstanding balance eligible for collections. Only send accounts if a payment hasn’t been made in _(60/120/180) days. Send 5 collection demands to your patient or transfer directly for debt collection calls. You are in total control of the process. Dedicated small business debt collectors. Contact us for a demo of our free Compulink debt collection utility.

Customizable Software for Every Specialty

The medical profession is not a one-size-fits-all business. The needs of a gastroenterologist are not the same as the needs of an ophthalmologist. The Compulink medical software is completely customizable, so you can tailor its applications to exactly what you need in your practice. This is especially important for specialists whose practices are different than general practitioners. You can get every feature and function you need from practice management software and, maybe, more importantly, none you don’t.

Get Paid Faster and Easier

With Revenue Cycle Management (RCM) from Compulink, it will take your practice less work to get paid more and faster than ever before. Your staff will no longer be responsible for submitting claims and appeals. While they are freed up for other, more crucial tasks, the expert staff at Compulink will take care of this for you, leading to a much smoother and more robust revenue cycle.

Implement Telehealth

In 2020, modern technology has allowed the medical profession to expand the type of care they give to patients and how they administer it. Telehealth is a huge leap forward in so many ways. It allows patients access to health care who may have found this difficult before and allows medical practices to increase their patient base and save time and money. Compulink allows practices to implement fully integrated, real-time video and audio chat with patients while accessing their medical records simultaneously. All this is fully secure and HIPAA compliant.

Utilize Medical Data

Compulink’s SMART Practice allows you to take all medical practices’ data and use it to help your practice optimize efficiency, improve patient outcomes, and increase revenue. Using Artificial Intelligence (AI), this system will turn your practice into an organization that knows exactly what to do and how to do it when looking to supercharge growth. This system is fully automated and works in real-time to produce reports for your practice that will tell you exactly what you are doing well and what you can improve on.

Conclusion

Compulink Medical Software is all-in-one, technologically advanced, and customizable for any medical practice. If you want to focus on the medical treatment side of your practice while still allowing for maximum growth on the business side, Compulink is right for you.

Ambulatory medical practices face unique challenges and have distinctive needs that other medical practices may not. That is why, if you are looking for an EHR and practice management software for your ambulatory practice, you want to make sure you find one that knows and understands these unique challenges and needs. That is where NextGen ambulatory software comes in. NextGen has been providing healthcare industry IT solutions since 1974 and have continually innovated to become a leader in the healthcare IT field. Here are some of the top features and benefits of their ambulatory EHR and practice management software.

Already using NextGen Dental Software? Have unpaid medical bills?  Need to transfer your overdue accounts receivable to a debt collection agency? Contact us You decide what should be the minimum outstanding balance eligible for collections. Only send accounts if a payment hasn’t been made in _(60/120/180) days. Send 5 collection demands to your patient or transfer directly for debt collection calls. You are in total control of the process. Dedicated small business debt collectors. Contact us for a demo of our free NextGen debt collection utility.

A Healthcare Partner 

For more than 40 years, NextGen Healthcare has worked with medical practices to help them grow and reach their full potential. Their knowledge and service make them a great partner for medical professionals looking to focus more on care and let a trusted, experienced outside vendor handle the business side of the practice. Their expert team will get your systems set up and integrated with your current IT and their well-trained and dedicated service team will make sure your systems are always running smoothly.

Patient-Facing Solutions

NextGen ambulatory software is not just a program that operates in the backend of your practice. They also offer a number of patient-facing solutions that will help increase revenue, streamline the time it takes to deal with patient needs and modernize the way your practice deals with patients. Stop wasting time with old-fashioned ways of patient relations. With NextGen ambulatory software, you can manage patients in a much more modern and efficient way.

Easily Scalable

While this software is specifically for ambulatory practices, it does not matter if you are a big practice or a small one. This software offers a customizable solution for all sizes of practices from single practitioners to large, multispecialty group practices. Because the software is scalable for all different sized practices, it also means that the software will grow with your practice. If your goal is to go from a small or medium-sized practice to a much bigger one, NextGen will help you do that and be the right solution at each step along the way.

More than Just Billing and Collections

This revenue cycle management (RCM) software is a holistic approach to the financial health of your practice. Yes, it does take care of billing and collections but it does so much more that will help put your practice on financially-firm footing. This software will allow your practice to improve financial performance, increase your revenue, elevate revenue cycle outcomes, and correct any operational inefficiencies.

Conclusion 

If your ambulatory practice is looking for an all-in-one solution to practice management, NextGen ambulatory software could be the perfect fit for you. This software rises to meet the specific needs of an ambulatory practice and the team at NextGen will look after your practice’s financial and business-side health.