Collection Agency for Small Balances

Question: A patient owes my office about $300 and isn’t responding to our billing letter even after we told him that we’ll send him to collections. I’ve now found out that our collection agency won’t take accounts under $500. What do I do?

Answer: Well, for one thing, I’d have a written policy on when patients get sent to collections. That may include the fact that no patients with balances under $500 are sent to collections. It’s bad to threaten something you don’t intend to do.

You can also shop for a new collection agency that accepts smaller balances.

As far as avoiding this in the future, you can try to collect at the time of service whenever you can. You can also offer patients a small discount (say, 8 percent) if they’ll pay before you send them to collections. That’s less than the collection agency charges, typically, and may get some action.

Make sure not to stretch your collection efforts over too long of a time period. The older the account, the harder to collect - folks are not more likely to respond to the third letter than the first.