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When a third-party collection agency contacts an insurance company, the insurer is reminded of its obligation to pay claims promptly. Failing to resolve medical insurance claims on time can result in a violation of state law.

Once an insurance company receives a collection notice from a professional collection agency, they are under pressure to act fast.

These laws and payout periods vary from state to state in terms of operation, complexity, and severity. However, they all share the common goal of compelling insurers to promptly and fully pay all legitimate claims. Debt issues in the BSFI market are anticipated to grow significantly over the next 10 years.

Non-timely reimbursements is a leading cause of stress and burnout among medical professionals, then why not outsource unpaid medical insurance claims to a professional agency and get paid faster.

Examples of “prompt-pay statutes” law in some states.

Texas Insurance prompt payment statute:
The Texas Prompt Pay Act (“TPPA”) is codified in the Texas Insurance Code as Subchapter J of Chapter 843 (governing health maintenance organizations (HMOs)) and Subchapters C and C-1 of Chapter 1301 (governing preferred provider organizations (PPOs)).

California prompt payment statute:
California Health & Safety Code 1371. A health care service plan, including a specialized health care service plan, shall reimburse claims or a portion of a claim, whether in-state or out-of-state, as soon as practicable but no later than 30 working days after receipt of the claim by the health care service plan, or if the health care service plan is a health maintenance organization, 45 working days after receipt of the claim by the health care service plan.

Florida Insurance prompt payment statute:
Florida statute 627.6131, otherwise known as the “Prompt Pay Statute,” requires insurance companies to make decisions and pay out on claims quickly. The timeframe created by this legislation depends on how the claim was received, either electronically or physically.

New York State prompt payment law health insurance:
Law § 3224-a (McKinney 2000) requires payment of health claims by health insurance companies within 45 days of receipt of such claim; N.Y. Ins. Law § 5106 (McKinney 2000) requires motor vehicle no-fault providers to pay health claims arising from vehicular accidents to be paid within 30 days of receipt of such claim.

North Carolina: 30 days for payment or denial.

North Dakota, Georgia: 15 days

Ohio, Oregon, Delaware, Idaho, Kansas, Kentucky, Maine, Maryland, Massachusetts, Minnesota, Montana, Nevada, Wisconsin: 30 days

Oklahoma, Colorado, Pennsylvania, Missouri, Nebraska, Vermont, Virginia, Wyoming: 45 days

Alabama, Arkansas: 30-45 days

Arizona: 30 days after the claim is approved

Louisiana: 25 to 45 days

Mississippi: 25-35 days

( days refer to “working” days)

References:
www.tlrfoundation.com/sites/default/files/pdf/TLR_Prompt_Pay_PDF_V01.pdf
danahyandmurray.com/florida-prompt-payment-statute/
www.dfs.ny.gov/insurance/ogco2002/rg207242.htm

GSA-approved collection agencies that specialize in “Government debt collection” are adept at handling the delicate aspects of the collection process. They possess the expertise to recover maximum funds while simultaneously upholding a reputation for fairness and maintaining a low rate of complaints. Their approach is tailored to the sensitive nature of government-related debt recovery.

Government debt collection agencies are easy to use and capable of fulfilling your Request-for-Proposal (RFP) if needed. It’s essential for these agencies to be adaptable and to prioritize specific accounts to ensure optimal returns. They should focus on maintaining low costs, strictly adhering to debt collection laws, and employing a customer-friendly approach to avoid harassing individuals during the debt collection process.

To achieve GSA approval, a collection agency must undergo a rigorous application and review process. This involves demonstrating its proficiency, financial stability, and strict compliance with federal regulations, including the Fair Debt Collection Practices Act. This comprehensive vetting ensures that the agency is capable and reliable in handling government-related debt collections.

Why are collection agencies so essential to recover unpaid government bills? 

When government employees or accountants reach out to debtors about settling past-due debts, the response is often not taken as seriously as when a professional debt collector intervenes. Collection agencies, as professional debt collectors, employ a range of legally permissible and diplomatic strategies to significantly increase the likelihood of debt repayment. For government collections, which encompass local city, county, municipal, state, and federal levels, maintaining a low complaint rate is crucial. Regularly presenting a collection performance report to the client is a fundamental aspect of the debt recovery process.

The landscape of federal and local debt collection laws is constantly evolving. Professional debt collectors undergo ongoing training to stay compliant with these changing regulations, including the Fair Debt Collection Practices Act (FDCPA), the Telephone Consumer Protection Act (TCPA), the Health Insurance Portability and Accountability Act (HIPAA), and various other directives.

Public agencies, such as county, municipal, state, and federal entities, rely on funding for essential services like school budgets, road construction, and emergency services. In this context, debt collection agencies play an indispensable role in the government’s financial ecosystem by recovering funds from past-due accounts.

In cases where standard debt collection tactics are unsuccessful, and if policy allows, high-value defaulters may be pursued legally. The collection agency’s legal department can potentially secure court orders for wage garnishment or bank account levies.

Government debt collections can involve a range of past-due accounts, from unpaid speeding tickets, property taxes, and water bills, to IRS/income taxes, parking fines, local citations, municipal fees, bounced checks, toll taxes, court collections, and other unpaid fines and taxes.

During municipal and government collections, the fees charged by the collection agency are generally added to the debtor’s total amount due. This approach ensures that the government agency itself does not incur a loss while recovering owed funds.

In government collections, there is an important rule:  An account is typically after the consumer has received at least one notice from the government before a debt is transferred to a third-party collection agency ( or at least the government department “attempts” to send a written notification).

There are minimum standards that a government debt collection agency has to follow:

1. Collections approach should be diplomatic, ethical and empathetic.
2. Ability to process large account volumes.
3. Follow FCPA, FCRA,  FDCPA rules and other laws and state-specific rules that may apply.
4. Dedicated government subject matter experts and a low complaint rate.
5. Offer a simple system to load accounts in their system and report the payments back to the client.

A nationally licensed government debt collection agency can recover money from debtors regardless of location, often in coordination with the General Services Administration (GSA). GSA coordinates and tracks debt collection through other government agencies with automated internal processes and collection technicians. Suitable for municipality, city, state and larger county debt collections.

* GSA Vendors are businesses that have been awarded a GSA Schedule Contract by the General Services Administration. These contracts allow federal, state, and local agencies to purchase products and services from these vendors at pre-negotiated prices and under pre-negotiated terms and conditions.

Serving: Alabama, Alaska, American Samoa, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, District of Columbia, Florida, Georgia, Guam, Hawaii, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Minor Outlying Islands, Mississippi, Missouri, Montana, Nebraska, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Carolina, North Dakota, Northern Mariana Islands, Ohio, Oklahoma, Oregon, Pennsylvania, Puerto Rico, Rhode Island, South Carolina, South Dakota, Tennessee, Texas, Utah, Vermont, Virginia, Washington, West Virginia, Wisconsin and Wyoming.

Contact us for your government debt collection agency requirement.