Starting a Medical Billing Business > Starting Your Own Medical Billing Business

A client who can't (or won't) pay

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williamportor:
That's good because the clock ticks at just that total amount (including the 1%)..
When he "agreed" he would take over his own billing did he notify you to terminate the contract in writing? Do you have terms in your contract about terminating contract with a specific means of notification (in writing, certified mail, etc)?  If so and he has not notified you properly you can indeed already consider the contract breached.   Is the amount low enough to go through your small claims but high enough to absorb the small costs of small claims?   When did the "next 60 days promise of payment begin?"

The 60 day "promise" was just a suggestion (made by me). My contract states either party can terminate the contract provided 14 days written notice ( via e mail or snail mail) is given. Yes, I can take this man to small claims court, but  I'm hesitant to take legal action at this point for 3 reasons:

1. He does not have the money, and no amount of legal paper shuffling will get me paid.

2. He is in California, and I am in Washington State. This will no doubt complicate the legal process. Taking several (if not many) hours out of my work day to chase after a $300.00 fee might not be in my best interest.

3. He's been a good client in the past, it's possible we may be able to restructure the contract, which includes a lower workload for me and lower fee for him. He has stayed in contact with me, and has been somewhat receptive to this idea.

I was just looking for ideas in case he did not pay me at all.
 

PMRNC:
Well your asking two different questions then.. "how long can you continue this debt legally" and "how long should I carry this debt". the answer is in your contract, it just might be that your trying to give the provider the benefit of the doubt. If your contract stated that LEGAL and written notice to terminate said contract existed.your client is already in breach. At this point I think you are wanting to end things amicably but within legal rights.. correct?   Again, I have to say you alredy have  breach.. how you proceed now becomes how you WANT to proceed. Remember also that it could set precedence for future clients.

kristin:

--- Quote ---The 60 day "promise" was just a suggestion (made by me). My contract states either party can terminate the contract provided 14 days written notice ( via e mail or snail mail) is given. Yes, I can take this man to small claims court, but  I'm hesitant to take legal action at this point for 3 reasons:

1. He does not have the money, and no amount of legal paper shuffling will get me paid.

2. He is in California, and I am in Washington State. This will no doubt complicate the legal process. Taking several (if not many) hours out of my work day to chase after a $300.00 fee might not be in my best interest.

3. He's been a good client in the past, it's possible we may be able to restructure the contract, which includes a lower workload for me and lower fee for him. He has stayed in contact with me, and has been somewhat receptive to this idea.

I was just looking for ideas in case he did not pay me at all.
--- End quote ---

I think you have been given some ideas about what to add to your future contracts with providers, if this should happen again, so let's focus on this particular one, and what to do, based on what you said above. I can understand based on #1 and #2 why you wouldn't pursue small claims court. It certainly seems like a situation where you "can't get blood from a stone", as the saying goes. If he doesn't have the money, he doesn't have the money. Right now, that is. He could be able to pay it at a later date. If he is dealing with trying to pay other bills like rent just keep his doors open, the last thing he would be worried about is paying you, seeing as how he took over the billing himself.

So that leaves your #3 option. Is the client worth you keeping him on at a restructured rate? $300 a month as a flat fee as it stands right now seems really low, unless all you are doing for him is very basic stuff, at a very low volume. But I don't know what all you do for that fee. Have you divided the hours you spend working on his account by what you charge him, to see what your hourly rate comes out to be? My guess is that it may be less than minimum wage, which means he is already getting a cut rate for your services, and to further cut that rate would mean you would be doing almost nothing for him, so you get a fair wage for what you do. Does that make sense? Unless he is able to pay you a fair wage, and better yet, get you more clients via referral, I think you are getting the very short end of the stick, and should walk away.

williamportor:

--- Quote from: PMRNC on March 10, 2015, 06:31:07 PM ---Well your asking two different questions then.. "how long can you continue this debt legally" and "how long should I carry this debt". the answer is in your contract, it just might be that your trying to give the provider the benefit of the doubt. If your contract stated that LEGAL and written notice to terminate said contract existed.your client is already in breach. At this point I think you are wanting to end things amicably but within legal rights.. correct?   Again, I have to say you already have  breach.. how you proceed now becomes how you WANT to proceed. Remember also that it could set precedence for future clients.

--- End quote ---

OK...It's pretty clear that I need to insert more specific language in to the agreement regarding delinquent accounts. This situation took me by suprise. Thank You for the input everyone.

RichardP:
williamporter - whereabouts in Washington State?  Just curious, if you can share.

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