Several hospital collection accounts are being reported on my credit report. In my dispute and validation letter to the CA that I am drafting right now, I am considering addressing one more matter in my letter. I came across on another website the following case: Here is my question. I have been looking at the relevant administrative code in Arizona (excerpted at the end of this post). Now, can it be said some of the time or can it be said ALL of the time that a CA can report a hospital collection account only if the agreement between the hospital and the CA specifically says that the hospital will permit the CA to report the account to the CRA ? Or, if the agreement does not specifically "yes, you can report", BUT if the agreement does not specifically say, "you can not report" is the CA allowed to report the account to the CRA ? Thank you (If it would help anyone, I could copy and paste the contents of the court case) R20-4-1504. Records B. All licensees shall keep and maintain books, accounts, and records adequate to provide a clear and readily understandable record of all business conducted by the collection agency, including: 3. An original of each written contract, between the licensee and a client, including any contract amendments. R20-4-1518. Agreements with Clients A collection agency's records shall document each client's account in writing. The records for an account shall include either a written agreement between the client creditor and the collection agency, or a written direction from the creditor to the collection agency concerning a specific debt placed for collection. The collection agency shall keep records that are specific, easily understood, and unambiguous. A provision of a written agreement or written direction that suggests the collection agency has authority to represent the client in court or to practice law in any other way is void and prohibited by this Section. The records for an account shall separately state: 3. The length of time the agreement or written direction is intended to be in effect, and 4. Any conditions regarding collection of a particular debt.
If I was on the receiving end of your letter, I'm not sure I'd know quite what to do with it. I understand that your letter is likely to be a bit more organized, but it's not clear what your point is. I'd suggest that if you want to dispute and ask for validation of the debt, then stick to that in the letter. If you want to take the hospital to task for violating some agreement, from what I read, it's not clear that you have any standing in that as near as I can tell that agreement would be between the hospital and the CA. You might be able to take the hospital on if they violated an agreement between you and them, but it's not clear that that's the case. I confess that I'm not familiar with that law (nor am I a lawyer and this is most definitely not legal advice). But I'd stick to only one issue in this letter and save the more involved and diffuse arguments for later (e.g. after you've researched them some more). The FDCPA procedures and requirements have the advantages of being both simple and strict liability which make for a much cleaner presentation.
A Dr's Office or Hospital can appear on your credit report. The case you quoted was when the CA reported an account to the CRA, despite a clause in their assignment agreement which prohibited reporting to the CRAs. I would presume that in the absence of such a clause, the CA would have the authority to report. Now, the tradeline has to obscure any MEDICAL INFORMATION, typically you'll see some code before the obscured information.
Thank you both very much for taking the time to reply, and thank you ccbob very much for your excellent advice about a point that I think I had been overlooking while drafting my letter: "But I'd stick to only one issue in this letter and save the more involved and diffuse arguments for later (e.g. after you've researched them some more). The FDCPA procedures and requirements have the advantages of being both simple and strict liability which make for a much cleaner presentation." Because I feel unsure about whether I did a good job communicating clearly in my previous post what was I asking, I'll quickly try to clarify: After reading that Blockbuster court case, what was going through my mind was that perhaps reporting a medical debt was similar to the situation with various charges that a collection agency might try to get away with tacking on that were not specifically spelled out by a hospital in the hospital-patient agreement. In other words, after reading that case the thought crossed my mind for the first time that perhaps if a hospital does not specifically say in its agreement with the collection agency that it hires that "okay, yes, it's okay with us if you report medical debts to the credit reporting agencies" that that would be an action that could not legally be taken (FDCPA 1692e5). It also crossed my mind that if a hospital, as in the case with Blockbuster, specifically forbade the collection agency that it hired from reporting debts to a CRA, does the debtor (such as me) have a right (under state and/or federal law) to request from the CA the agreement between the CA and the hospital in order to look for that information and then say to the CA, "A-ha! You never had the permission from the hospital to report this account that is now on my report!" Maybe I've been misunderstanding the point of that case; maybe the main point (or the only point) of the case is really that the collection agency made a threat to report the overdue Blockbuster account to the CRA, never followed through on that threat, and was therefore guilty of making a threat to take an action that was not intended to be taken ?
15 USC 1692e you might have grounds for a complaint under http://www.ftc.gov/os/statutes/fdcpa/fdcpact.htm#807 if they are making claims/threats that they cannot or have no intention of taking action on. I'd imagine that you'd have to name both the hospital and the CA in the suit so you could file for discovery of any agreements that they might have between them that restrict their actions. What I'm not clear on is their threats of reporting aren't illegal, they just might violate an agreement between the CA and their client, the hospital. So it seems to me that they could go and make good on their threat to report and then suffer the consequences with their client later (e.g. lawsuit, loss of future business, etc.) Either way, that would put the CA in an uncomfortable position so that might be enough leverage to get them to at least, not report it to a CRA. But that's just me talkin'.
