New York’s healthcare debt collection process has changed throughout the years. Doctors in NY have to deal with a high cost of living, burnout, regulatory challenges, insurance reimbursement issues and significant health disparities based on race, ethnicity, socioeconomic status, and other factors. Addressing these disparities can be a complex and challenging task.
Medical professionals continue to grapple with elevated levels of accounts receivable, impacting their profitability and sustainability. Most of these debts come from doctors, dentists and ambulance rides. Hiring a collection agency will de-stress your staff and give them time to focus on the core tasks for which they were hired in the first place.
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New York has its own set of laws that supplement the FDCPA. The New York City Department of Consumer Affairs enforces the city’s own debt collection regulations, which offer protections beyond the federal FDCPA.
Here are some key aspects of New York’s debt collection laws:
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Licensing Requirement: In New York City, all debt collection agencies must be licensed by the Department of Consumer Affairs.
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Statute of Limitations: In New York, the statute of limitations on debt varies depending on the type of debt. The statute of limitations for most consumer debts, such as credit card debt, is six years. Once this period has passed, the debt becomes “time-barred,” meaning the creditor or collector can’t successfully sue the debtor to collect the debt.
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Debt Validation: Debt collectors are required to validate the debt. If you request it, they must provide written verification of the debt.
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Communication: Collectors must respect consumers’ wishes about when and how to contact them. If you request in writing that a collector stop contacting you or contact you only through a lawyer, they must comply with this request.
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Harassment and Abusive Practices: Both the FDCPA and New York law prohibit debt collectors from harassing, oppressing, or abusing any person in connection with the collection of a debt.
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Unfair Practices: Debt collectors are prohibited from using unfair or unconscionable means to collect or attempt to collect a debt.
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Garnishment and Property Seizure: If a creditor obtains a court judgment against a debtor, they may be able to garnish wages or seize certain assets. However, New York law provides certain exemptions.
New York Medical and Health Care Debt Collection Statistics
Almost half of the country is in debt, with the majority of those unpaid balances coming from medical bills. The average unpaid medical debt balance averages out to about $580. A vast majority of New Yorkers (about 15%) have found that they have received emergency treatment within the course of a few months. However, around 7% of those patients are uninsured.
The 2016 report showed that 7% of patients between the ages of 19 and 64 are uninsured. While this number has seen a decrease in 2012, this number still negatively affects doctors and hospitals who find these patients have no immediate way to pay for their medical expenses. Eventually, these doctors will send off their unpaid accounts to a New York medical debt collection agency.
Problems Faced by New York Doctors and Hospitals
Even though doctors and hospitals can save face with their patients by sending them to collections, it still causes an imbalance in their business expenses.
Lack of payment can lead to staff cuts, longer hours, and debt of their own. Hospitals have tried to remedy this loss by cutting back on necessary medical equipment, staffing hours, and even payment. This can often lead to insufficient care from overworked doctors or lack of available services in lieu of proper medical equipment. Doctors have also realized that their salaries are being more narrowly negotiated because hospitals can’t afford to pay doctors at a higher wage if the patient debt is too large.
New York Debt Collection Medical Laws
Around 2006, New York set laws to protect patients from aggressive debt collection calls.
New York law also dictates that medical institutions and professionals must provide patients with the option for payment plans and/or alternative payment options.
The Statute of Limitations for New York is six years. This refers to the amount of time a medical establishment has to sue a patient for non-payment. The clock starts ticking the moment the patient receives their first bill and restarts after their most recent payment.
Medical debt still affects a patient’s credit score. Doctors typically do not personally sue their patients for unpaid bills, rather, they sell their unpaid patient expenses to a debt collection agency. The agency will contact the former patients for payment.
There are now strict rules against debt collectors about contacting patients for medical and health care debt collections. They cannot harass, bully, or contact patients in unethical manners to try to procure a form of payment. And according to The Atlantic, “New York and eight other states have passed comprehensive laws protecting patients from surprise billing.”
References:
thefinancialclinic.org/medical-debt-collection-know-your-rights/
https://www.credit.com/credit-scores/how-medical-debt-can-impact-your-credit-score/
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