Collections

Recover Revenue. Protect Your Reputation. Stay Compliant.

California changed the rules for medical debt collection. A legitimate patient balance can still be recovered—but consumer credit reporting is generally off the table, hospital lawsuits cannot begin before 180 days after initial billing, and qualifying patients can still seek charity care or discounted payment even after the billing process has started.

Collect911 helps California medical and dental providers separate collectible patient responsibility from insurance issues, financial-assistance accounts, and legally restricted balances before recovery begins. Newer accounts can use a cost-effective fixed-fee approach, while older and more difficult balances can move to contingency collections—without treating every unpaid account the same way.

California’s current law prohibits furnishing medical debt information to consumer credit reporting agencies, while the state’s hospital fair-billing rules contain additional requirements around financial assistance and collection activity.

At a Glance: Why CA Businesses Choose Us

• Industry-Leading Recovery Rates: We outperform national averages by leveraging advanced skip-tracing and credit reporting.

• 100% Compliant: Strictly adhering to the Rosenthal Act, HIPAA, and FDCPA.

• 4.8/5 Star Rating: Trusted by clients with over 2,000+ Google Reviews. Rated 4.8 /5.

• Statewide Reach: Serving San Diego, San Jose, Sacramento, Fresno, and every city in between. Licensed in all 50 states, so if your debtor crossed state lines, we can continue to pursue collections.

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Two Flexible Pricing Models

We don’t believe in one-size-fits-all. Choose the plan that fits your cash flow.

1. Contingency Service (No Recovery, No Fee)

Best for older or difficult debts. We shoulder the risk.

• Zero upfront cost.

• We only get paid when you get paid.

• Includes comprehensive skip-tracing, credit bureau reporting, and litigation support if needed.

2. Fixed-Fee Service (Pre-Collection)

Best for recent debts (under 90 days). Keep 100% of the money collected.

• Pay a small, flat fee per account.

• Monies are paid directly to you.

• Acts as a gentle extension of your billing department to nudge payments without burning bridges.

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Industry-Specific Expertise

For Medical & Dental Practices

Patients are not just debtors; they are your community. California’s medical landscape requires a delicate touch. We specialize in collecting for Dentists, Urgent Care, and Private Practices while strictly adhering to HIPAA and California medical billing regulations. We recover the funds without triggering malpractice claims or negative online reviews.

For Commercial (B2B) Business

Don’t let unpaid invoices choke your cash flow. From Silicon Valley SaaS contracts to Construction liens and Freight/Logistics disputes, we understand commercial leverage. We report to commercial credit bureaus (Dun & Bradstreet, Experian Business), giving debtors a powerful incentive to pay you first to protect their own credit lines.

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Ironclad Compliance & Security

California has some of the strictest collection laws in the nation. One mistake can lead to a lawsuit. We protect you by handling the legal complexities.

• The Rosenthal Fair Debt Collection Practices Act (RFDCPA): We strictly follow California’s specific extension of federal law, ensuring no harassment or unfair practices.

• Data Security: Your data is protected by 256-bit encryption and our client portal features Two-Factor Authentication (2FA).

• Statute of Limitations: We monitor California’s 4-year statute on written contracts so you never miss a legal window to collect.

• No Hidden Fees or Commitments: Enjoy our services without any minimum balance requirements, minimum number of accounts, setup fees, or binding contracts. Our customer agreement is open-ended and non-committal.

• Complimentary Credit Bureau Reporting: Benefit from free credit bureau reporting, enhancing the effectiveness of our collection efforts.

• High Recovery Rates with Full Compliance: We achieve excellent recovery rates while strictly adhering to FDCPA, HIPAA, TCPA, and GLBA regulations.

• Personalized Support: Beyond our central customer service team, you’ll have a dedicated Sales Representative assigned to you for direct, personalized assistance.

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Wage Garnishment

• California has specific laws that limit the amount of wages that can be garnished to repay a debt. The state provides greater protection than federal law, allowing only the lesser of 25% of a worker’s disposable earnings or the amount by which a worker’s disposable earnings for the week exceed 40 times the state minimum hourly wage.
• Certain types of income, like social security, disability, and retirement, are exempt from garnishment in California.

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Recent Recovery Results:

Los Angeles Multi-Specialty Practice — Fixed Fee — 70% Recovered

A Los Angeles physician group identified $18,600 in relatively recent patient-responsibility balances after insurance payments and contractual adjustments had been posted.

The practice moved the eligible accounts into its fixed-fee collection program rather than continuing repeated front-desk follow-up.

Placed: $18,600
Recovered: $13,020
Recovery Rate: 70%

The practice preserved a softer approach for current patients while clearing a substantial portion of aging A/R.

San Diego Specialty Clinic — Fixed Fee + Contingency — 56% Recovered

A specialty clinic accumulated $29,750 in mixed-age patient balances. Some accounts were still relatively fresh, while others had already gone through repeated statements and telephone follow-up.

Newer accounts entered fixed-fee recovery first. Harder balances were later escalated to contingency collections.

Placed: $29,750
Recovered: $16,660
Recovery Rate: 56%

Separating the portfolio by age allowed the practice to avoid paying contingency fees on every account.

Sacramento Outpatient Provider — Contingency — 46% Recovered

A Sacramento outpatient provider referred $42,300 in substantially aged patient receivables after its internal billing team had exhausted routine follow-up.

The accounts were assigned to the contingency collection program.

Placed: $42,300
Recovered: $19,458
Recovery Rate: 46%

Despite the age of the balances, the provider recovered nearly half of the referred receivables and incurred collection fees only on successful recoveries.

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Frequently Asked Questions:

Can a California medical provider report an unpaid medical bill to the credit bureaus?

Generally, no. California Civil Code Section 1785.27 prohibits furnishing information about medical debt to a consumer credit reporting agency. If a person knowingly violates that prohibition by reporting the medical debt, the debt can become void and unenforceable. California therefore requires medical providers and their collection partners to rely on compliant recovery methods rather than consumer credit reporting. Limited statutory exceptions can apply in unusual situations, so account type and payment history should be reviewed before collection activity begins.

What notice must California medical debt contracts include after July 1, 2025?

A written contract entered into on or after July 1, 2025 that creates medical debt must contain California’s required disclosure explaining that the debt holder is prohibited from reporting the medical debt to a consumer credit reporting agency. Current California law also provides that a written medical-debt contract entered into after that date that omits the required language is void and unenforceable. Medical and dental practices should therefore review newer patient financial agreements before referring balances for collection.

What must a California hospital tell a patient before sending a bill to collections?

Before assigning a hospital bill to collections, California law requires the hospital to provide a notice containing specific information. This includes the dates of service, the name of the company receiving the account, information on obtaining an itemized bill, the health coverage the hospital had on record, a financial-assistance application, and information showing when the patient was previously notified about financial assistance. This documentation is important when hospital-originated accounts are transferred for recovery.

Can a California patient apply for hospital financial assistance after the bill is already overdue?

Yes. California hospitals cannot impose a deadline that prevents an otherwise eligible patient from applying for charity care or discounted payment simply because the bill has aged. Eligibility can be determined when the hospital receives the required financial information. Generally, uninsured patients and patients with high medical costs whose family income is at or below 400% of the federal poverty level must be eligible to participate in the hospital’s charity-care or discount-payment program, although special rules apply to certain rural hospitals.

Does California’s 180-day rule mean a hospital cannot use a collection agency for six months?

Not exactly. The 180-day rule is more specific. A hospital, its assignee, or another owner of the hospital debt cannot begin a civil lawsuit against the patient for nonpayment until at least 180 days after initial billing. California also places separate conditions on selling hospital debt to a debt buyer. Before assigning a bill to collections, the hospital must provide the required collection and financial-assistance notice. This is why the age of the account and the type of collection action matter.

What happens if a financially qualified California hospital patient stops making payments?

California hospital financial-assistance payment plans are subject to special protections. A reasonable payment plan generally cannot require monthly payments exceeding 10% of the patient’s monthly family income after essential living expenses, and eligible extended payment plans are interest-free. If the patient misses all consecutive payments for 90 days, the hospital or collection partner must make a reasonable attempt to contact the patient and provide an opportunity to renegotiate before declaring the plan no longer operative. A civil action cannot begin while the qualifying payment plan remains operative.

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How to Prepare a California Medical Account for Collections

Step 1 — Verify the patient-responsibility balance

Post insurance, Medicare, Medi-Cal, contractual adjustments, refunds, and other third-party payments before deciding that the remaining amount belongs to the patient.

Step 2 — Identify whether hospital-specific rules apply

A private physician or dental balance and a hospital-originated medical debt may be subject to different requirements. Flag hospital accounts before deciding what collection actions are available.

Step 3 — Check financial-assistance status

For applicable hospital accounts, confirm whether the patient has applied for or may qualify for charity care or discounted payment. Do not treat an unresolved financial-assistance account like ordinary bad debt.

Step 4 — Confirm that required notices were sent

For hospital debt, retain the collection notice, dates of service, financial-assistance information, insurance information, account statements, and documentation supporting the balance.

Step 5 — Remove consumer credit reporting from the strategy

California generally prohibits furnishing medical debt information to consumer credit reporting agencies. Build the recovery workflow around compliant communication and collection activity instead.

Step 6 — Choose the appropriate recovery path

Recent, well-documented balances may fit a fixed-fee collection program. Older, harder-to-locate, disputed, or previously unsuccessful accounts may be better suited to contingency collections.

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Ready to Clear Your A/R Ledger?

Don’t let another 30 days pass. The older a debt gets, the harder it is to collect.

Need a Collection Agency for your unpaid Invoices? Contact us

 

Commercial Recovery: Moving Beyond the “Check is in the Mail”

You’ve sent the invoice. You’ve called Accounts Payable. You’ve been promised “the check is in the mail.” For a CFO, controller, or credit manager, that’s usually the signal to stop chasing and start escalating. Our Account Reconciliation Team bypasses the gatekeepers and gets your invoice in front of the person who actually approves payment, serving hundreds of businesses nationwide to resolve the billing gridlock that’s stalling your accounts receivable.

Quick answer: The earlier a delinquent B2B account moves to professional recovery, the higher the odds of getting paid. Accounts under 180 days past due recover at roughly 80%; that rate falls the longer an invoice sits, since a debtor’s cash, attention, and willingness to prioritize an aging vendor bill all decline with time. Commercial debt collection works best as a structured, early escalation, not a last resort after months of internal follow-up.

Our recovery rate runs over 75% for B2B accounts less than 250 days old, climbing to about 80% for accounts under 180 days. More than 90% of accounts resolve without ever filing suit. No Recovery = No Fee.

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Protecting your business reputation, Collect911 holds licenses in all 50 states, ensuring a safe approach for every client interaction. We provide free litigation and bankruptcy scrubs with zero onboarding or annual fees. Our SOC 2 Type II ensure total data security, backed by a 4.85/5 rating from over 2,000 professional reviews. Delivering high recovery rates!

Need a Commercial Collection Agency? Contact us

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In-House Follow-Up vs. Professional Commercial Recovery

Metric	In-House A/R Follow-Up	Collect911 Commercial Recovery
Staff time required	Ongoing, competing with the rest of your finance team’s workload	Minimal — account is handed off, tracked through updates
Recovery probability (180+ days past due)	Declines sharply without dedicated leverage or tools	~75–80% on accounts under 250 days
Commercial credit bureau reporting	Not typically available to an individual creditor	Available for eligible accounts, adds real pressure
Skip tracing & asset investigation	Limited to what staff can find manually	Litigation, bankruptcy, UCC, and address checks included
Legal escalation	Requires sourcing and vetting outside counsel separately	In-network attorney referral with pre-litigation analysis

The Performance-Based Recovery Model

Our commercial strategy is results-driven with zero upfront risk to your firm. We operate on a Tiered Contingency model: no recovery, no fee. Fees range from 10% to 45% depending on the balance, age, and complexity of the account, communicated to you in advance for total transparency. This aligns our incentives with yours, applying 20+ years of commercial credit and recovery experience to resolve balances efficiently.

The Commercial Collection Roadmap: Our 8-Step Process

Out-of-court settlement is always our top priority. We use advanced negotiation, compliance-driven outreach, and credit reporting leverage to resolve delinquent accounts amicably. This approach recovers your money faster, protects professional relationships, and saves you hundreds in court costs and legal fees.

Phase 1: The Commercial Scrub

Every account undergoes an immediate litigation check, bankruptcy search, and USPS address verification to identify high-risk entities before any outreach begins.

Phase 2: Asset & Liability Investigation

Deep-dive research into the entity’s financial health, including UCC filings and property ownership, determines the most effective recovery path, and flags accounts where a debtor’s assets are already heavily encumbered elsewhere.

Phase 3: Professional Mediation

Bilingual outreach acts as a professional intermediary to resolve disputes and verify account status, aiming to clear up genuine billing confusion before assuming bad faith.

Phase 4: Business Credit Bureau Reporting

If an account remains unresolved, the delinquency can be reported to major business credit bureaus, impacting the entity’s ability to secure future credit and often prompting faster resolution.

Phase 5: Secretary of State & Licensing Review

The entity’s standing with state regulators is verified. Flagging potential threats to corporate standing or operating licenses often accelerates reconciliation.

Phase 6: Final Demand & Legal Review

If mediation fails, the account is escalated for a final legal review to determine whether litigation is viable given the entity’s actual asset profile, not just the size of the balance.

Phase 7: The Legal Step

With your authorization, our network of commercial attorneys initiates formal litigation as a final action to secure a court judgment.

Phase 8: Enforcement of Judgment

Post-judgment, bank levies, wage garnishments, or property liens are pursued where available to convert the judgment into an actual recovery.

Clinical Philosophy: Urgent, Effective, and Respectful

As an Account Reconciliation Team, we operate as an authoritative peer to your accounting department, not an outside collections operation. A late payment is often a breakdown in communication rather than a refusal to pay, so acting as mediators resolves discrepancies without damaging long-term vendor relationships. This frees your staff to focus on growth rather than the grind of chasing balances.

The Security & Integrity Suite

Integrity is non-negotiable. Every call is recorded and audited to protect professional standards and your reputation. A litigation check at intake identifies debtors with a documented history of using frivolous lawsuits to avoid paying, a real and growing tactic among sophisticated commercial debtors.

Realistic Smart Collection Methodology

A wholesale equipment distributor had a single commercial account, a regional contractor, fall 140 days past due on a $72,000 order of heavy machinery parts. Internal follow-up calls had gone unanswered for two months. An asset and liability check found the contractor was mid-bid on several new municipal contracts, giving real weight to a credit-bureau reporting threat, since a delinquency mark could jeopardize their bonding and bidding eligibility. Within three weeks of that leverage being applied, $65,400 of the balance was recovered through a negotiated payment plan, avoiding litigation entirely.

Here are two more recent B2B commercial debt recovery results:

Result 1: The Building Materials & Wholesale Distributor

• The Situation: A regional building supplies distributor was owed $82,000 by a commercial subcontractor who had gone completely silent after completing a project. The invoice was 140 days past due, and the client’s internal accounts receivable team was receiving standard stall tactics (“we’re waiting on general contractor funding”).

• The Solution: The distributor submitted the account to Collect911’s B2B commercial recovery program. The team immediately conducted corporate asset discovery and skip-tracing, identified active business operations, and issued a firm, compliant formal commercial demand notice.

• The Result: Within 21 days, Collect911 negotiated a structured 2-part payment agreement. The full $82,000 balance was recovered in full, allowing the distributor to avoid writing off a massive margin-draining loss.

Result 2: The Industrial Equipment Rental & Logistics Firm

• The Situation: An equipment rental firm was holding $45,500 in overdue balances across three separate commercial accounts ranging from 90 to 180 days past due. The debtor companies were ignoring direct staff emails and withholding payment while continuing operations elsewhere.

• The Solution: The firm transferred the accounts to Collect911’s Performance Contingency commercial model. Collect911 initiated pre-litigation analysis and leverage via commercial credit bureau reporting options, signaling that the debts would directly impact the debtors’ corporate credit profiles.

• The Result: Within 35 days, two debtors paid their balances in full, and the third entered a verified payment schedule. Collect911 recovered $39,800 (87.4%) of the total outstanding commercial debt without requiring costly courtroom litigation.

Frequently Asked Questions

What’s a typical contingency rate for B2B debt recovery, and why does it vary so much?

Rates generally run 10% to 45%, and the spread comes down to age, complexity, and dollar size rather than being arbitrary. A fresh, well-documented $50,000 invoice is a very different recovery project than a $3,000 balance that’s been stale for two years and needs skip tracing just to find a working address. The fee should track the actual work and risk involved in a specific account, not a flat number applied across the board.

Our delinquent customer is a franchisee. Can we pursue the franchisor for the unpaid balance?

Usually not, and it surprises a lot of suppliers. Franchise law generally treats a franchisee as an independent business responsible for its own trade debts, and a franchisor typically isn’t on the hook just because their name is on the sign outside. The exceptions are narrow: a franchisor that personally guaranteed the account, or one so operationally entangled with the location that a court treats it as the franchisee’s true employer or principal, which is a high bar. Knowing which entity actually signed your credit application matters more here than which brand is on the building.

The account that owes us is a government agency or municipality. Does that change how collection works?

Significantly. Government entities generally can’t be pursued the same way a private company can; sovereign or governmental immunity often blocks standard lawsuits and asset seizure, and many agencies have their own required claims process that has to be followed before a court will even hear the matter. Wage garnishment and bank levies, the usual post-judgment tools, frequently aren’t available against a public entity’s operating funds at all. These accounts almost always call for a different playbook than a private commercial debtor.

We just learned our invoice was already sold to a factoring company. Does that change who we’re actually owed by, or who can collect?

It can shift the account out of your hands entirely. Once a receivable is genuinely sold to a factor, the factor typically owns the right to collect it, not the original business, and their own factoring agreement usually dictates who pursues a nonpaying account and under what terms. Before assuming you can place that invoice with us directly, it’s worth confirming whether the sale was a true sale or a recourse arrangement where the obligation could come back to you.

Our research turned up a UCC-1 blanket lien from the debtor’s bank. Is the account still worth pursuing?

Often, yes, just with adjusted expectations rather than none at all. A blanket lien means a secured lender has first claim on the debtor’s assets in a liquidation or bankruptcy scenario, which affects what’s realistically recoverable if things go that far, but it doesn’t erase an ordinary business’s incentive to pay a routine trade invoice to keep operating and preserve vendor relationships outside of a worst-case scenario. This is exactly the kind of finding our Asset & Liability Investigation step is meant to surface early.

Could we get sued for harassment or an FDCPA-style violation while trying to collect a B2B debt ourselves?

It’s a real risk, more than most business owners assume. While the federal FDCPA is written around consumer debt, a number of states have their own statutes that extend similar communication and conduct restrictions to original creditors collecting commercial debt, and even outside those laws, a debtor pushed too hard has other legal theories, harassment, defamation, tortious interference, available if a collection effort gets aggressive or public. This is part of why moving a stalled account to a professional team is often the lower-risk path, not just the more effective one.

Areas of Commercial Expertise

• Commercial Lease & Property Management Arrears
• Manufacturing & Supply Chain Invoice Reconciliation
• Professional Services & Consulting Balances
• Wholesale & Distribution Account Recovery
• SaaS & Technology Subscription Arrears
• Construction & Subcontractor Payment Disputes

Ready to Clear Your A/R Ledger?

Don’t let unpaid invoices choke your cash flow. Let us apply the professional pressure needed to get you paid.

Get a Commercial Recovery Quote

You provide the care. We ensure the assets are used to pay for it.

A past-due senior living account is rarely just an unpaid bill. It may be private-pay rent, a Medicaid-pending balance, resident patient-pay controlled by a Power of Attorney, or a claim that now belongs in probate. The first question is not simply “How do we collect it?”—it is “Who actually owes it, and which funds can legally be pursued?”

Collect911 helps assisted living communities, memory care facilities, skilled nursing facilities, and other senior care providers sort out those differences before recovery begins. Fresher balances can be handled through a low-cost fixed-fee program, while move-outs, deceased accounts, and harder aged balances can move to contingency collections with no collection fee unless money is recovered. The goal is straightforward: recover legitimate receivables without turning every family issue into a confrontation.

 

Protecting your practice’s reputation, Collect911 holds licenses in all 50 states, ensuring a safe approach for every patient interaction. We provide free litigation and bankruptcy scrubs with zero onboarding or annual fees. Our SOC 2 Type II and HIPAA-compliant systems ensure total data security, backed by a 4.85/5 rating from over 2,000 professional reviews. Delivering high recovery rates!

Need a Medical Collection Agency? Contact us

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Flexible Pricing for Every Scenario

1. Pre-Collect Service (Fixed Fee)

• Best For: Current residents 60-90 days past due.

• Cost: Low flat fee (e.g., ~$15/account).

• Method: A diplomatic “Audit & Reminder” approach sent in your name.

• ROI: You keep 100% of the recovered funds.

2. Contingency Collections (Standard)

• Best For: Move-outs, deceased accounts, or hostile families. Accounts over 120 days.

• Cost: A percentage of the collected amount.

• Risk: No Recovery, No Fee. If we don’t collect, you pay $0.

The “Hidden” Cost of Unpaid Senior Living Debt

In the senior living industry, margins are tighter than ever. According to recent industry data, the average Assisted Living facility operates with a margin of just 28-32%, while Skilled Nursing Facilities (SNFs) often run closer to 1-3%.

Every unpaid invoice hits your bottom line directly.

• Average Bad Debt: A single unpaid move-out in senior living averages $4,500 – $12,000.

• The “POA” Factor: It is estimated that over 60% of senior living bad debt is caused not by the resident’s lack of funds, but by the financial mismanagement of the adult child or legal guardian controlling the checkbook.

We stop this leakage by holding the financial decision-makers accountable.

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Our 3-Pronged Recovery Strategy

We categorize every account to apply the correct legal pressure:

1. The “Negligent POA” Strategy

The most frustrating scenario for an Executive Director is seeing a resident with a pension and Social Security, yet the rent remains unpaid.

• The Approach: We bypass the resident and target the fiduciary. We remind the Power of Attorney (POA) of their legal obligation to use the resident’s assets for care first.

• The Leverage: Misappropriating a senior’s funds can be a criminal offense in many states. When a POA realizes that their own financial conduct could be scrutinized, payment is often prioritized immediately.

2. The Estate & Probate Strategy

When a resident passes away, families often claim, “Mom had no money left.”

• The Reality Check: We conduct deep-dive Probate and Asset Searches. We identify real estate transfers, life insurance payouts, or hidden Trusts.

• Creditor Claims: If an estate is opened, we file the necessary paperwork to ensure your facility is listed as a priority creditor before the inheritance is distributed to the heirs.

3. The “Medicaid Gap” Strategy

Waiting for Medicaid approval can leave a facility with months of unpaid “Share of Cost” (NAMI) balances.

• The Solution: We pursue the Patient Liability portion aggressively. Retroactive Medicaid payments go to the facility, but the “Share of Cost” often gets stuck in the resident’s bank account. We ensure that money comes to you, not the family.

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Collections Without Eviction: The “Census Protection” Model

Your goal is to keep your beds full. Involuntary discharge is a regulatory minefield involving Ombudsmen, 30-day notices, and safe discharge planning.

We act as a buffer. By involving a third-party agency, we change the dynamic. We can often negotiate payment plans or “catch-up” structures that allow the family to resolve the debt so the resident can remain in your community. We recover the funds, you keep the census.

We handle adult children, designated POAs, and estate representatives through empathetic, documentation-first mediation—verifying legal authority and providing clear accounting to resolve balances respectfully without family conflict or legal friction.

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How to Prepare a Senior Living Account for Collection

Step 1 — Identify the true balance
Reconcile the resident ledger and separate private-pay charges, insurance payments, Medicaid-covered amounts, and the resident’s actual responsibility.

Step 2 — Confirm who is responsible
Review the admission agreement and determine whether the account belongs to the resident, an estate, or another legally liable party. Do not assume that a POA, adult child, or “Responsible Party” is personally liable.

Step 3 — Check Medicaid and payer status
Confirm whether Medicaid eligibility, an appeal, Medicare payment, long-term care insurance, or another third-party payment is still pending.

Step 4 — Assemble the collection file
Include the admission agreement, itemized ledger, statements, payment history, relevant resident-representative information, and documentation supporting the outstanding amount.

Step 5 — Match the account to the right collection stage
Fresher balances may fit a fixed-fee pre-collection approach, while older move-outs, deceased accounts, and harder balances may require contingency collections.

Step 6 — Keep payment information current
When the facility receives a payment, Medicaid adjustment, insurance payment, or probate distribution, update the collection balance promptly so recovery efforts remain accurate.

Frequently Asked Questions (FAQ)

Does signing as a “Responsible Party” make an adult child personally responsible for a nursing home bill?

Not automatically. For Medicare- or Medicaid-certified nursing facilities, federal rules prohibit requiring a third party—such as an adult child, relative, or friend—to personally guarantee payment as a condition of admission, expedited admission, or continued stay. A representative who has legal access to the resident’s income or resources may be asked to agree to use the resident’s funds toward the resident’s care, but that does not by itself make the representative personally liable. Assisted living communities that are not governed by these federal nursing-facility rules may be subject to different state laws and contract requirements.

What if a Power of Attorney controls the resident’s money but the senior living facility is not being paid?

The first step is to determine what authority the POA actually has and whether the representative has legal access to the resident’s available funds. Federal nursing-facility rules allow a facility to require such a representative to arrange payment from the resident’s income or resources without assuming personal financial liability. Collection efforts therefore need to distinguish between pursuing resident assets that should have been applied to care and incorrectly treating the POA’s personal assets as automatically responsible for the debt. State fiduciary and elder-abuse laws may also affect how suspected misuse of resident funds should be handled.

How should a senior living facility handle an unpaid balance while Medicaid eligibility is still pending?

Do not automatically treat a Medicaid-pending balance as ordinary family debt. CMS guidance recognizes that a nursing facility may charge a resident while Medicaid eligibility is pending, subject to the rules of the state where the facility operates. If Medicaid is later approved, however, the account may need to be adjusted so that the resident is charged only amounts permitted under Medicaid, including the applicable resident contribution and allowable non-covered items. The Medicaid application status should therefore be verified before an account is escalated.

What part of a Medicaid nursing home bill can still be collected from the resident?

Medicaid residents can still have a legitimate monthly financial responsibility. Depending on the state’s terminology, this may be called patient pay, patient liability, share of cost, or another similar term. Medicaid’s post-eligibility calculation determines how much of the resident’s income must generally be contributed toward the cost of institutional care after permitted deductions, such as a personal-needs allowance and certain allowances for a community spouse. Facilities should distinguish this resident-responsibility amount from services already included in the Medicaid nursing-facility benefit, which generally cannot simply be billed again to the resident.

A resident died leaving an unpaid senior living balance. Should the family or the estate be pursued?

Usually, the starting point is the deceased resident’s estate, not an assumption that the children or other relatives personally owe the balance. An executor, administrator, or personal representative can use estate assets to resolve valid debts according to applicable probate law, but serving as the representative does not by itself require that person to pay the resident’s debts from personal funds. Creditor-claim deadlines and priorities vary considerably by state, so deceased accounts should be identified quickly and reviewed for probate activity rather than simply sending bills to surviving relatives.

When can a nursing facility consider discharge for nonpayment while Medicaid is involved?

For federally regulated nursing facilities, nonpayment can support a transfer or discharge only under specific conditions. Federal rules address situations where the resident fails to submit necessary third-party-payment paperwork or where Medicare or Medicaid denies payment and the resident then refuses to pay. If the resident becomes Medicaid eligible after admission, the facility may charge only amounts permitted under Medicaid. Transfer and discharge procedures also carry notice, documentation, appeal, and other requirements; when a qualifying transfer or discharge appeal is pending, the resident generally cannot simply be removed while that appeal is unresolved.

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Recent Recovery Results:

Assisted Living Community — Fixed Fee — 58% Recovery

A senior living community had a growing group of 60–90 day private-pay balances from otherwise active residents. Rather than moving immediately to aggressive collections, the facility placed $12,750 into a fixed-fee recovery program.

Accounts Placed: $12,750
Recovered: $7,395
Recovery Rate: 58%

The softer first-stage approach recovered more than half of the referred balance while allowing the community to preserve ongoing relationships with residents and families.

Memory Care Move-Out Accounts — Contingency — 43% Recovery

A memory care provider accumulated $28,600 in unpaid move-out balances after several families stopped responding once their relatives had left the community.

Because the accounts were older and required more intensive follow-up, they were assigned to contingency collections.

Accounts Placed: $28,600
Recovered: $12,298
Recovery Rate: 43%

The provider incurred collection fees only on money successfully recovered.

Skilled Nursing Accounts — Fixed Fee + Contingency — 51% Recovery

A skilled nursing facility identified $21,400 in mixed resident-responsibility balances, including unpaid patient-pay amounts and older balances that remained after payer adjustments.

Fresher, documented accounts began in fixed-fee recovery. Accounts that remained unresolved were moved to contingency follow-up.

Accounts Placed: $21,400
Recovered: $10,914
Recovery Rate: 51%

Separating verified resident responsibility from payer-related balances gave the facility a cleaner portfolio to collect and avoided treating every aged balance the same way.

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Stop Subsidizing Your Residents’ Families

You have provided the care, the meals, and the safety. You deserve to be paid for it. Let us handle the uncomfortable financial conversations so your team can focus on the residents.

We are experts in Senior Living Debt Collection Contact Us – Serving all 50 states  Serving some of the biggest names in your industry.

 

When a company provides a product or service, it has a right to expect to be paid on a timely basis. However, anyone who’s been in business a month or more has learned that prompt payment is not always the case. Often, accounts get seriously past due, or when payments are made, there may be insufficient funds in the customer’s account to cover a check. Accounts not paid within terms can have a dramatically negative impact on the “cash flow” of a business.

1. Have a Defined Credit Collection Policy

One of the major causes of overdue receivables is that the business has not explained to its customers and staff when accounts are to be paid. If customers are not educated that their accounts are to be paid on time, then chances are they’ll pay late or sometimes, not at all. Make sure that your company’s terms of payment are clearly stated in writing to each customer.

2. Invoice Promptly and Send Statements Regularly

If you don’t have a systematic invoicing and billing system, get one. Many times the customer hasn’t paid simply because they haven’t been billed or reminded to pay in a timely manner. This situation usually occurs in smaller or newer businesses, where they may be short-handed on staff needed for timely invoicing and billing.

(CONNECT STEP 1, our 1st Party REMINDER service, done in your name, can help with this!)

3. “Address Service Requested”

One of the most difficult collection problems is tracking down a customer who has “skipped”. All businesses should be aware of a special service that the US Postal Service offers. Any statement or correspondence sent out from a business or professional office should have the words “Address Service Requested” printed or stamped on the envelope, just below your return address in the top left corner. If a statement or invoice is sent to a customer who has moved without informing you of their new address, and the words “Address Service Requested” appear on the envelope, the Post Office will research this information and return the envelope to you on a yellow sticker that gives the new address or other updated information. If the customer has placed a “forwarding order,” we suggest that you check with your local Post Office to see what additional options you may have for follow-up. This will help you keep your address files up to date.

4. Contact Overdue Accounts More Frequently

There is no law that says that you may only contact a customer once a month. The old adage “The squeaky wheel gets the grease” has a great deal of merit when it comes to collecting past due accounts. It’s an excellent idea to contact late payers every 10-14 days. Doing so will enable you to diplomatically remind the customer of your terms of payment.

5. Use Your Aging Summary Report, Not your Feelings

Many well-meaning businesses owners (or staff members) have let an account age beyond the point of ever being collected because of the “feeling” that the customer would pay eventually. While there are isolated cases of unusual situations, the truth is that if you aren’t being paid, someone else is. Stick to your systematic follow-up plan. You’ll soon identify who really intends to pay and who doesn’t. You can then take appropriate actions.

6. Make Sure Your Staff is Well-Trained

Even “experienced” staff members can sometimes become jaded when dealing with past due customers. This usually happens when debtors have broken promises for payment that have been made previously. Make sure the staff is firm, yet courteous when dealing with them. Your entire staff could benefit from customer service training because, in effect, they must “sell” your customers on the idea that you expect to be paid. Make sure that your collection staff is trained to both, bring the account to current status, while also maintaining “good will” with the client base.

7. Admit any Mistakes on Your Part and correct them ASAP

Sometimes customers don’t pay because they feel that you’ve made a mistake. If you have, quickly admit it and correct it. Your customer realizes that mistakes can happen in business. Unfortunately, many customers believe that the owner or president “doesn’t need the money.” Denying an obvious error only fans the fire of resentment that your customer may already feel.

8. Follow all Federal and State Collection Laws

In many states, businesses are governed by the same collection laws that regulate collection agencies. For example, calling customers at an odd hour or disclosing to a third party that the debtor owes you money, are just a couple of the numerous collection practices that can cause serious repercussions. If you’re not sure, call your state’s department of finance which governs and monitors collection agencies.

9. Use a Third Party Sooner

If you’ve systematically pursued your past due accounts for 60 to 90 days from the due date, (and they still haven’t paid) you’re being delivered a message by your client. More than likely, you’ve requested payment four to six times in the form of phone calls, letters and statements. Statistics show that after 90 days, in-house collection effort loses up to 80% of its effectiveness. That means that the time and financial resources budgeted for collection efforts should be focused within the 1st

60-90 days, when the bulk of your accounts can and should be collected. From that point on, a 3rd party can motivate your client to pay you in ways that you cannot, simply because the demand for payment is coming from someone other than you. Before paying a contingency collection agency, an attorney or using small claims court, why not explore using a fixed flat-fee collection services.

We offer CONNECT STEP 1 (our 1st Party Reminder Service) & CONNECT STEP 2 (our 3rd Party Service) for a Fixed Flat-fee of about $15 per account, regardless of the amount owed, or where the debtor is located in the U.S.!

COLLECT STEP 3 is our contingency service.

10. Remember that Nobody Collects Every Account

Even by setting up and adhering to a specific collection plan, there will still be a few accounts that will never be collected. By identifying these accounts early, you will save yourself and your company a great deal of time and money. Even though a few may slip by, you’ll find that overall the number of slow pay and nonpaying accounts will greatly diminish, and that’s a victory in itself!

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About the author:
Todd , Regional Business Development Partner is available to answer your CASH FLOW questions. He has MORE tips on how to increase cash flow by making the best payment arrangements with your customers, along with providing your team with a special “script” to follow to get you paid faster! He will also give suggestions on what to look for when choosing a collection agency and what choices you have for recovering your delinquent accounts.

Todd is available for workshops for Rotary Clubs, Business groups, Chambers of Commerce and Trade Associations. There is NO FEE. He will also be happy to offer an accounts receivable analysis for business owners & medical practices ~ FREE of CHARGE!