When to Call? When to Write?
Collection calls are very effective collection tools. Collection letters are very commonly used collection tools.
There is a delicate balance between the ratios of collection calls to collection letters in order to benefit you most in managing your accounts. We know that collection calls should be your first and foremost effort. In reality, your best telephone effort will only allow you to talk to about 25% of the patients you call.
Your backup is the well-worded collection letter that tells the patient what you would have said if the phone call was completed. The collection letter is only part of having a well-rounded collection effort.
Another aspect of the collection letter would be to provide a means of contacting large volumes of accounts. We’re talking about a situation where there are many more accounts than collector resources to effectively handle them
Mass mailings of properly worded collection letters can be effective if accounts are just going to be in hibernation. Realistically, when playing catch-up, this last-resort effort is the only approach you can take. One drawback to using just collection letters is that the tremendous cost involved in producing and mailing the letters does not always bring acceptable results. Always do a cost/benefit analysis before taking this tack.
It’s really as simple as 1-2-3
- Letters are only a one-way communication.
- Problems are not solved, arrangements are not made and customer complaints are not resolved simply by mailing collection letters.
- Surveys have shown that letters by themselves produce poor results. 20% is a very optimistic return. Translated, that means that at least 80% of the cost and effort is lost.
The answer?
Very few providers are properly staffed with adequate personnel to apply a well-balanced telephone and collection letter effort. We are not saying you have to go out and hire five more people. We are saying that if you are going to get the best bang for your budgeted bucks, you need a plan.
Maximizing resources means you will have:
- Fewer letters
- More phone calls
- A higher rate of cash flow
- A lower rate of charge-off
If you could use help in determining staffing needs or creation a work plan to manage your receivables, contact us.
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