If the call center software you or your collection agency uses meets the Federal Trade Commission’s (FCC) definition of autodialing under the Telephone Consumer Protection Act (TCPA), it is an invitation to a class action lawsuit. The TCPA prohibits pre-recorded or auto-dialed calls to a person’s telephone without their prior consent and carries a minimum of $500 and a maximum of $1,500 statutory damages per call.
There are many fine strokes in the TCPA law and the wide variance in court rulings from state to state have made it even more complicated for those involved in collections. Look at these examples of federal court decisions in various TCPA cases.
$500,000 for faxes: Neurocare Institute of Central florida, P.A., faxed individuals and businesses regarding services offered by HealthTap, Inc. The court ruled against the association. They had to make a maximum of $500,000 available for settlements.
$5.3 million for cell phone messages: A federal judge ruled against Kaiser Permanente in a class action suit that alleged Kaiser sent unsolicited, pre-recorded messages to former customers’ cell phones after they canceled their Kaiser health insurance plans. The court levied a $5.3 million settlement against Kaiser.
$75.5 million for automated dialer: In 2014 Capital One and 4 other firms agreed to pay $75.5 million to end a consolidated class action lawsuit alleging that the companies used an automated dialer to call customers’ cell phones without consent.
At the core of TCPA enforcement is the issue of “consent”; has a consumer or patient clearly been given the opportunity to give their consent to receive calls, including debt collection calls and texts, from the company or organization? The answer is; it all depends. Some federal judges have ruled that consent is not consent unless it is “clearly and unmistakably stated” on any business form. Other judges have ruled that “distributing one’s telephone number is an invitation to be called, especially when the number is given at another’s request.”
FCC Commissioner Michael O’Rielly admits that enforcement of the law needs to be cleaned up. “Over time, as the FCC and the courts have interpreted the TCPA, business models and ways of communicating with consumers have changed. As a result, the rules have become complex and unclear.”
For hospitals the TCPA issue is especially tricky. According to Class Action News, a current case involves a hospital that asked an outside firm to collect from an emergency room patient who was not paying his bill. As one of its collection efforts, the firm used robocalls to the man’s cell phone number that he wrote on the ER admission form. The patient filed a class action lawsuit, saying that the robocalls violated the federal TCPA. He said listing his cell phone number on the admission form did not satisfy the “express consent” requirement under the TCPA.
So, as you can see, the waters are muddy and the stakes are high. The literature shows that an experienced lawyer can get the court to rule on 3 or 4 TCPA violations per call. If your practice was found to have made multiple calls, with multiple violations per call, at $500 to $1500 a violation…well, you do the math. The fines can potentially amount to more than the debt you are trying to collect.
At least one effort is underway to obtain some type of national consensus on the TCPA issue. The ACA (Association of Credit and Collection Professionals) is petitioning the FCC to ensure that legitimate, non-telemarketing debt collection calls are not unfairly delayed and to confirm that not all predictive dialers are categorically automatic telephone dialing systems.
What are you to do? How can you collect outstanding debt when the threat of class action lawsuits hovers over the collection agency as well as the organization owed the debt? We have several suggestions.
1: Make sure that the consent is boldly placed on all forms. Place it front and center on the form, in bold font, highlighted in yellow (and any other extremely obvious manner), so that the person signing is very clear that their signature gives you the right to call or text them to collect a debt.
2: Ask a collections expert to audit all of your patient forms. Make sure the right consent language is in the right place.
3: Review your robodialing system and/or call center software. Make sure you know it does not expose you to class action suits.
4: Understand, in detail, the collection efforts your outsourced vendor is going to take on your practice’s behalf. If they are found in violation of the TCPA you can be named as well; forced to defend yourself in a class action lawsuit.
Several courts have ruled that the damages are not insurable, so you if you lose, you may have to pay the damages out of pocket.
We admit that the unpredictable, state-by-state enforcement of TCPA can seem like the Wild West. Don’t worry. We are here to help you saddle up and keep riding until the dust settles. To read more about how to address TCPA in your collections efforts, www.emeraldar.com
Hyperlinks in order of appearance in the article:
Cell phone messages, Kaiser Permanente: http://www.bigclassaction.com/settlement/kaiser-permanente-tcpa-class-action-lawsuit-reaches.php