Collector - March 2018 - 37
a common topic of conversation in office
meetings or at unit events. It has prompted
discussions on The Hub, ACA's online
member community (http://community.
acainternational.org/home), that show
agencies go both ways when it comes to
credit reporting and are continuously
evaluating their policies.
Wayne McBride, president and CEO
of DiRecManagement Inc., says he finds
agencies are following tradition when it
comes to their credit reporting practices. If
credit reporting is part of their collections
process or required by clients, agencies will
continue to do so in compliance with the
new NCAP requirements. If they had not
previously reported consumers' accounts for
their clients, they are not starting now.
"There is obviously a great deal of
indecision about reporting to the bureaus.
I think you just have to look at what's best
for you and your client and realize there
is a certain amount of risk out there,"
At DiRecManagement, credit reporting
for medical debt, in compliance with the
NCAP, is a part of the agency's process, but
only after all collection and payment efforts
"We don't want to ding somebody's
credit if there is a chance for them to pay,"
McBride said. "Our goal is to help the debt
not to be reported if the debtor is willing
to communicate with us. We don't report a
lot of debtors that can prove to us that they
don't have the ability to pay."
BRIDGING THE GAP
The NCAP was designed to allow more
time for consumers' insurance payments
to be applied when they have a medical
bill. It also enhances CRAs' ability to
collect complete and accurate consumer
information and will provide consumers
more transparency and a better experience
interacting with credit bureaus about their
consumer credit reports.
In some cases, McBride's team will
connect with consumers who say they have
insurance to help with their payment after
the 180-day waiting period has already
passed, allowing even more time before
credit reporting could occur.
"If I call a debtor and they tell me they
have insurance, even beyond 180 days, we
are not going to report them to the [CRAs]
until we've exhausted insurance options,"
Before the medical debt credit reporting
requirements officially changed last year,
the Consumer Financial Protection Bureau
had its eye on regulating medical debt
collections. Additionally, the new credit
scoring model has lessened the impact of an
outstanding medical debt on a consumer's
report, according to Nicholson Stief.
For agencies that do include credit
reporting in their collections process, the 180day requirement can create some challenges.
"The issue with the 180-day rule is it's
180 days from the first date of delinquency,
not necessarily the first date of service,"
Nicholson Stief said. "Every single medical
client that you have could potentially have
a different date of delinquency, so it's not
as simple as setting up your system to hold
off on credit reporting for 180 days. It's 180
days, plus the number of days each client
considers their delinquency date to be."
Agencies in compliance with all federal
and state requirements and the NCAP are
still a target for credit reporting disputes and
litigious attorneys looking for minor errors
they can take to court.
As a result, the Credit Bureau of
Lancaster County is evaluating the pros
and cons of credit reporting medical
debt as well as adding more focus and
dedication to enhancing resources that
will allow them to continue to grow their
business and work with consumers on
resolving rightfully owed debts. Nicholson
Stief noted that many of the company's
hospital clients have already elected to
discontinue credit reporting.
"If we do decide to discontinue credit
reporting medical debt, we can always start
again if we want to," Nicholson Stief said.
"But it's exciting to think about utilizing
our time and our resources into other
aspects of growing the business rather
than contending with the robo-disputers,
e-OSCAR, predatory attorneys and the
complexities of some of the regulations."
REPORT AND REVIEW
Nicholson Stief said if the Credit Bureau of
Lancaster County does discontinue credit
reporting, it will reevaluate its policies
again after six months. "Many of our
medical clients have already discontinued
and there has been no negative impact to
our business," she said. "We've had our eye
on this for a few years."
She continued: "It was not one single issue
but rather multiple changes to medical debt
credit reporting that caused us to say, 'It's
time to take a look at this.' There are other
agencies that haven't taken a close look yet
as far as not credit reporting and there are
many other agencies I've spoken to that have
found the costs, risks, ineffectiveness and
the exposure to frivolous lawsuits far exceed
any perceived value, so it's just an individual
decision that each company needs to make."
McBride's agency will continue to include
credit reporting in the collections process
after working with consumers on their
payment options and also plans to evaluate
this approach regularly to ensure it's
To make the best business decision for
your company, you'll want to look at the
benefits of credit reporting compared
to the costs and compliance risks and
connect with your staff and clients
regularly to get their feedback.
"I do think it's a good time to take a closer
look and a deeper dive and see how much it
is costing you," Nicholson Stief said. "How
much of your payments come in because of
credit reporting and how much is it costing
you to continue to do that?"
Katy Zillmer is ACA International's
For more information, ACA International
members may access ACA SearchPoint™
document #1515, Credit Reporting Medical
Accounts, and #1526, Disputes from Consumer
Reporting Agencies to Furnishers Under the
FCRA at www.acainternational.org/searchpoint.