The Consumer Financial Protection Bureau (CFPB) issued the final rule to update Regulation F October 30, which implements the Fair Debt Collection Practices Act (FDCPA).

The 653-page final rule from the CFPB allows debt collectors to interact with consumers across all forms of electronic communications.

Set to take effect in fall 2020, the CFPB rules will have a significant impact on the healthcare payments landscape for healthcare providers with third-party debt collectors and their patients.

Pursuing a digital transformation strategy then becomes not a matter of “if” but “when.”

The one-year implementation period provides an opportunity to assess the regulations, then, compare with existing processes and determine whether gaps exist.

It is also a perfect opportunity to serve the consumer better. It is high time to determine how best to implement a digital strategy that will improve patient financial experience.

The patient collections vertical is one that is ripe for digital transformation. 90% of patient collections are still mostly paper-based, according to a recent study.

Due to the pandemic, hospitals and healthcare systems also lost an average of $50.7 billion per month. This was just in the US alone from months March through June.

Need for Smarter Approach in Patient Collections

As more healthcare bills go to patients themselves, many health systems find their existing patient collections strategies fall short.

Today’s patient collections challenges call for a smarter approach.

Traditional solutions are built to collect from insurance companies and not directly from patients. Providers are exposed to an unpredictable financial landscape where their revenue cycle rests on their patients’ ability to pay.

According to a report by Aite Group, of the 15.5 billion bills that Americans paid last year, 406.4 million were medical bills totaling $86.4 billion in overall spending—not including copayments.

The report also revealed that medical bills were taking up more of a consumer’s paycheck.

Healthcare organizations have experienced disruption and difficulty due to the pandemic. The changes stemming from COVID-19 are shaping up to be significant and long-lasting.

Organizations are using this time to make a true change in their patient collections. This makes the process more efficient but also inherently more patient-focused and compassionate.

The same report by Aite Group also found that significant changes are taking place in the way Americans pay bills. These include more digital payments and an overall increase in credit card and debit card spending.

Capturing Consumer Preference

The final rule from the CFPB creates a series of opportunities for consumers to drive the method by which they wish to communicate about their debts.

Consumers can initiate communication on their own using their preferred methods of communication (traditional or electronic).

They can also opt in or out of a series of choices, knowing they can always make changes late. These include returning to standards methods like snail mail and telephone calls.

Technology will also be critical in electronic communications as debt collectors need to consider a lot of things like:

  • Capturing consumer preference on telephone calls, in letters, emails, self-service portals, text messages, website ‘contact us’ pages, voicemails, and in response to artificial voice prompts.
  • Enabling staff to capture and update consumers’ consents, opt ins, and opt outs to assure they can pivot to keep up with consumers’ preferences.
  • Being able to access accurate information quickly to ensure that the time, place, and manner of communication with the consumer, at any given time, align with consumer expectations. Collectors will simply not have time to scroll within account histories to ensure that specific consumer outreach, whether outbound or inbound, is compliant.
  • Being able to limit communications so that they are not delivered at either inconvenient times or in an inconvenient manner
  • Allowing consumers to express a preference about whether to be communicated with at a place of employment

Effective Digital Communication Strategy to Boost Digital Payments

The final rule from CFPB focuses on how the protections of the FDCPA apply to modern digital communication formats such as email, text, and social media messages.

Debt collectors are explicitly allowed to use all forms of electronic communications to contact consumers. They can do so by email, text message, or social media messages.

However, in a 2019 survey, half of healthcare consumers are frustrated with their provider’s patient billing and collections processes. It is even more frustrating for those that are not digital yet.

Thus, having a digital strategy and using the right technologies allows your organization to achieve the intent and purpose of this regulation.

Just like in the financial and retail industry, healthcare providers are expected to drive consumers to them and offer self-serve options.

This means robust online portals that allow patients to make payments, review account history information, balances, and payment histories. This also means exploring repayment alternatives, and more importantly, set their preferences.

Patients are accustomed to receiving text notifying them of upcoming bills. Just one click of a button and it explains to them what that bill is for, how much it is, and how to make a payment.

Effective digital communications can help patients avoid surprise bills and check their coverage. It will also help patients get onto the right payment plan or charity program, if appropriate.

When it’s easy for patients to pay, balances will be cleared more promptly.

Providers and third-party debt collectors will need to foster more long-term patient relationships to improve their patient collections.

Patient collections strategies must also be more flexible to accommodate evolving patient needs and CFPB rules. This became ever more prevalent during this pandemic and its effects are rolling over into 2021.

About Mnet Health

We believe every patient deserves a helpful, transparent, easy-to-navigate financial experience in healthcare.

Mnet is the premier revenue cycle management & technology provider to the surgical industry. Mnet provides customized patient-pay solutions to surgical hospitals and ambulatory surgery centers. Mnet Health partners with over 900 surgical facilities nationwide and is the preferred vendor to the leading ASC management companies in the US both directly with and in support of centralized billing offices.

Mnet’s tailor-made brand, PaySUITE, is a white-labeled payment technology platform that helps surgical facilities, and their providers grow their business by helping patients pay. Mnet’s patient-pay solutions significantly increase self-pay collections while creating a better financial experience for patients. For more information, visit