Collection on delinquent patient accounts is an unavoidable and often burdensome task in dental practice management. Many practices are seeing an increase in delinquent accounts receivable, which consume valuable resources including staff and time. Some practices may attempt to collect past due amounts internally, while others may outsource this effort to third party debt collectors. The method by which your firm collects on debt implicates federal and state laws and regulations that must be followed.

Debt collection is governed by the Fair Debt Collection Practices Act (FDCPA), a federal consumer protection statute. The Act creates guidelines under which debt collectors may conduct business, rights of consumers involved with debt collectors, and penalties for violating the Act. Some of the prohibited conduct include the hours for phone contact, failure to cease communication upon request, threatening arrest or legal action that is not actually contemplated, and many other acts and practices.

Although FDCPA only applies to third party debt collectors (including attorneys), some state and federal consumer protection laws have expanded the scope of covered parties to include the debt originator, thus not providing dental practices protection against litigation if they collect on their own behalf. If you collect debt on behalf of your own practice it is important to maintain compliance with state and federal laws and regulations. Similarly, if you outsource this activity to a third party collection agency, it is important to perform proper due diligence to ensure the collection agency remains compliant.

If you are interested in more information, please contact TLG Attorney Dean Kadri.