Debt Sales Process

How much is your non-paying bad debt worth?  That will be determined once you get the spreadsheet to the purchasing party to do their due diligence.

Expect some questions at this point, such as how many agencies the accounts have been to and whether any legal work was done on them.    Prices of non-paying medical account receivables can range from 20 basis points/per dollar for older out-of-statute accounts to several cents on the dollar for new accounts that have never been to an agency.   In general, the first sale will be a clearing out of older and newer accounts, and the price per dollar will be lower than future ongoing sales where the accounts are more recent.   The type of debt will also weigh into pricing.   It really boils down to the recovery rate the purchasing agency can expect.   After the first deal, the purchasing agency will have some results on your specific office’s recovery rate, and later deals can be priced based on these results.  

 What should you look for in a Purchasing Agency?   The same thing you would look for in a collection agency.   You want a company that has a good standing and understands that these are patients who could potentially come back to your office. You want an agency that understands Medical Debt and all the associated laws with collecting it. You want to communicate with them on any issues that may arise. Still, you also should expect them to be able to handle the collections with minimal interference with your office once the deal is closed. You have provided them with the information and paperwork you agreed to. 

 What do you have to do after the sale?  This is the beauty of this arrangement; nothing!  Any calls you get on the past due accounts you have sold, you simply forward to the company that purchased them.  They will take care of everything from there.   There could be some minor refund/repurchase requirement of bankrupt or similar accounts or the odd account you need to close for some legal reason from your end, but for the most part, you are finished spending money chasing non-paying accounts.