Complaints:
• The Industry is allowed to pursue individuals based on un-validated information and are never required to demonstrate that a debt is legitimate.
o Collections Agencies are predominately seeking to collect debts previously deemed uncollectable that are consolidated and sold as a block. Each time the debt is sold, less information regarding the debt is passed to the receiving company. After a few cycles, it appears the receiving company only has a name, a purported value and contact information.
• Even when Individuals challenge the debt as illegitimate by providing information in good faith, the collection company has no motivation or requirement to cancel or acknowledge the claim. Once a person is placed on a collection list, there appears to be no way to be removed without paying the purported debt even if it is not legitimate.
o Calls are largely staged from “Boiler Rooms” using computer auto dial. The collections agent who comes on wen the call connects with a live person is neither familiar with the case nor interested in anything other than closing the payment.
o There does not appear to be a statute of limitations on when an uncollected purported debt would no longer be pursuable.
• The Collection company is not required to be truthful about the process. When the collection company calls, they seek to pressure the individual into providing information to legitimize their case and pressuring the individual to pay even just a small amount, claiming that will erase the debt, but in reality, such an action will “restart the clock” on the debt and they will pursue full payment even harder.
• There is no ombudsman function where both sides can present their information and receive a binding decision regarding legitimacy of the purported debt.
What I would like to change:
• Require collection companies to have a legitimate pedigree on each debt in its portfolio – to include the name of the individual or corporation that initiated it, how the debt was incurred, what the terms were and what if any payments were made.
• Require the collection agency to divulge to the individual all information related to the debt up front, including who originated the claim, what other companies have owned the debt and require them to ask if the individual acknowledges the debt as legitimate or not legitimate. If the individual claims to have evidence that the debt is not legitimate, the case must be referred to an ombudsman for adjudication. If the Ombudsman determines the debt is not legitimate, the collection agency must remove the debt from its portfolio and either write off the debt or refer a claim back to the originator.
• There must be a legal mechanism for people to challenge the legitimacy and/or methods of the collections agency. Small Claims court or non-partisan (not paid for by the Collections Agencies) Ombudsman must be publicly known and readily accessible to hear any complaint and empowered to render actionable remedy to the complaint if proven warranted.
My Personal Experience Leading to these complaints and recommendations:
From approximately 18 years ago, my family and I participated in family therapy related to depression in one of my sons. The therapy was conducted through a series of insurance policies – we changed coverage from Kaiser (all in house therapists) to Aetna (who paid various rates for “in-plan” and “Out of Network” services). We ended up with a Psychiatrist and his staff Psychologists who managed therapies and medications. During our time with them, the Doctor changed his relationship with the Insurer from “in-Network” to “Out of Network” and near the end of our involvement ultimately sold his practice to a larger Medical system. Throughout the entire process, we paid every Co-pay and required share of expense for services, but the Insurance paid only a derated share of the portion of the Bill they were sent – ie. Cost of services rendered would be a certain amount and the insurance would pay whatever they determined the services to be worth and expect the Medical practice to absorb the difference. We were never billed for that difference, but I believe the Company that absorbed the practice did so at a value that was based on a total billing value. I believe when they did a bookkeeping merger, decided that the uncollected value was uncollected debt. It is possible that the combined organization went bankrupt – I do not know, because we did not continue our involvement. All I do know is a few years after we stopped receiving treatment, we started getting calls from a collection agency. We were concerned about impact to our credit rating and went to extraordinary lengths to deal in good faith with the company. Since they were the first recipient of the “debt” they were able to tell us where the debt came from. My wife provided copies of a VERY large file of medical bills that showed that we had paid EVERY required co-pay. The individual handling the account agreed with our assessment and they stopped calling. A few years later, it appears that uncollected amount was consolidated and sold to another collection company and the process started all over again. This time the collections company appeared to have no information about the origination of the debt and no interest in facts. After speaking with them several times it became clear that they would only accept money to stop the harassing calls. Over time, the calls would slow, then stop, only to start up again when the account was sold to yet another company. In the past two years, the calling has become incessant with the introduction of robo-dialing. We get calls at 8am on weekends, we get calls at dinner time, we get calls almost every day. About 2 years ago, I tried talking to the person who picked up after the computer detected that someone was on the line. He would not offer ANY information about who owed money, what the purported debt was from or when it was incurred. All he wanted was to get some form of payment – he claimed that if I paid $40, that would close it out. I believe, from things I have read that this is just a trick to gain current legitimacy of the debt.
I am angry that this has been allowed to continue so long without a reasonable method of remedy. If I truly owed this debt, I believe it would have showed up in my Credit Report – it has not. I resent the notion that I would have to pay a lawyer several thousand dollars to try to take this on in court. The collections business needs to have regulations like all legitimate businesses and there needs to be both a statute of limitations and a method for reaching an un-biased, binding ruling when the person being pursued can show the claim is not legitimate.
SG
1
Complaints: • The Industry is allowed to pursue individuals based on un-validated information and are never required to demonstrate that a debt is legitimate. o Collections Agencies are predominately seeking to collect debts previously deemed uncollectable that are consolidated and sold as a block. Each time the debt is sold, less information regarding the debt is passed to the receiving company. After a few cycles, it appears the receiving company only has a name, a purported value and contact information. • Even when Individuals challenge the debt as illegitimate by providing information in good faith, the collection company has no motivation or requirement to cancel or acknowledge the claim. Once a person is placed on a collection list, there appears to be no way to be removed without paying the purported debt even if it is not legitimate. o Calls are largely staged from “Boiler Rooms” using computer auto dial. The collections agent who comes on wen the call connects with a live person is neither familiar with the case nor interested in anything other than closing the payment. o There does not appear to be a statute of limitations on when an uncollected purported debt would no longer be pursuable. • The Collection company is not required to be truthful about the process. When the collection company calls, they seek to pressure the individual into providing information to legitimize their case and pressuring the individual to pay even just a small amount, claiming that will erase the debt, but in reality, such an action will “restart the clock” on the debt and they will pursue full payment even harder. • There is no ombudsman function where both sides can present their information and receive a binding decision regarding legitimacy of the purported debt. What I would like to change: • Require collection companies to have a legitimate pedigree on each debt in its portfolio – to include the name of the individual or corporation that initiated it, how the debt was incurred, what the terms were and what if any payments were made. • Require the collection agency to divulge to the individual all information related to the debt up front, including who originated the claim, what other companies have owned the debt and require them to ask if the individual acknowledges the debt as legitimate or not legitimate. If the individual claims to have evidence that the debt is not legitimate, the case must be referred to an ombudsman for adjudication. If the Ombudsman determines the debt is not legitimate, the collection agency must remove the debt from its portfolio and either write off the debt or refer a claim back to the originator. • There must be a legal mechanism for people to challenge the legitimacy and/or methods of the collections agency. Small Claims court or non-partisan (not paid for by the Collections Agencies) Ombudsman must be publicly known and readily accessible to hear any complaint and empowered to render actionable remedy to the complaint if proven warranted. My Personal Experience Leading to these complaints and recommendations: From approximately 18 years ago, my family and I participated in family therapy related to depression in one of my sons. The therapy was conducted through a series of insurance policies – we changed coverage from Kaiser (all in house therapists) to Aetna (who paid various rates for “in-plan” and “Out of Network” services). We ended up with a Psychiatrist and his staff Psychologists who managed therapies and medications. During our time with them, the Doctor changed his relationship with the Insurer from “in-Network” to “Out of Network” and near the end of our involvement ultimately sold his practice to a larger Medical system. Throughout the entire process, we paid every Co-pay and required share of expense for services, but the Insurance paid only a derated share of the portion of the Bill they were sent – ie. Cost of services rendered would be a certain amount and the insurance would pay whatever they determined the services to be worth and expect the Medical practice to absorb the difference. We were never billed for that difference, but I believe the Company that absorbed the practice did so at a value that was based on a total billing value. I believe when they did a bookkeeping merger, decided that the uncollected value was uncollected debt. It is possible that the combined organization went bankrupt – I do not know, because we did not continue our involvement. All I do know is a few years after we stopped receiving treatment, we started getting calls from a collection agency. We were concerned about impact to our credit rating and went to extraordinary lengths to deal in good faith with the company. Since they were the first recipient of the “debt” they were able to tell us where the debt came from. My wife provided copies of a VERY large file of medical bills that showed that we had paid EVERY required co-pay. The individual handling the account agreed with our assessment and they stopped calling. A few years later, it appears that uncollected amount was consolidated and sold to another collection company and the process started all over again. This time the collections company appeared to have no information about the origination of the debt and no interest in facts. After speaking with them several times it became clear that they would only accept money to stop the harassing calls. Over time, the calls would slow, then stop, only to start up again when the account was sold to yet another company. In the past two years, the calling has become incessant with the introduction of robo-dialing. We get calls at 8am on weekends, we get calls at dinner time, we get calls almost every day. About 2 years ago, I tried talking to the person who picked up after the computer detected that someone was on the line. He would not offer ANY information about who owed money, what the purported debt was from or when it was incurred. All he wanted was to get some form of payment – he claimed that if I paid $40, that would close it out. I believe, from things I have read that this is just a trick to gain current legitimacy of the debt. I am angry that this has been allowed to continue so long without a reasonable method of remedy. If I truly owed this debt, I believe it would have showed up in my Credit Report – it has not. I resent the notion that I would have to pay a lawyer several thousand dollars to try to take this on in court. The collections business needs to have regulations like all legitimate businesses and there needs to be both a statute of limitations and a method for reaching an un-biased, binding ruling when the person being pursued can show the claim is not legitimate.
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