The most common mistake healthcare providers make when outsourcing medical debt collection is making their selection based upon whoever offers the lowest fee or promises the highest return. But the second most common mistake?

Signing the standard client services contract that the agency puts in front of them.

Healthcare providers must make sure that any contract with a collection agency  includes protections and performance guarantees that by necessity must exceed those imposed on other vendors. Without these safeguards, not only can providers suffer a loss of revenue, but can also be held liable by regulators and law enforcement for the actions of their collection partner.

So what should be negotiated into the agreement with your collection partner? Here are the top 10 provisions to include in your medical debt collection services contract:

  1. Protections against HIPAA liability: You must enter into a separate agreement with the collection agency called a HIPAA Business Associates Contract;
  2. Protections against liability under other laws that may apply to the collection process, including the Fair Debt Collection Practices Act, Fair Credit Reporting Act, Gramm-Leach-Bliley Act, Federal Trade Commission Act, Affordable Care Act, and state laws;
  3. A description of the methods and techniques the agency will use to collect debts under the agreement;
  4. The specific services the agency will provide, including non-collection services like medical coding and billing;
  5. The agency’s reporting obligations—what collections information it will report to you, in what format, and how often;
  6. A requirement that the agency account for and report its contacts with patients;
  7. How the agency will be paid;
  8. How the agency will remit payments—frequency, information included, and whether fees will be deducted;
  9. A description of any client support services the agency will provide; and,
  10. Your rights to terminate the agreement with or without cause. and our sister site,, have assembled a helpful guide to negotiating services agreements with medical debt collection agencies (including a sample contract), which you can purchase here: “A Guide to Negotiating a Medical Debt Collection Services Agreement.

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