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FCC Guidance on Cellphones Puts the Squeeze on Medical Debt Collectors

In July, the FCC released an order it touted as strengthening “consumer protections against unwanted calls and texts.” It was a series of rulings based on the Telephone Consumer Protection Act meant to clarify the use of autodialers, procedures for wrong numbers and consent to call, mainly concerning cellphones. Under these new regulations, healthcare providers must get express written consent to be able to contact patients on their mobile phones about medical debt and billing.

puzzled woman on the phone

The problem for medical debt collectors is that they are required to confirm that they have received express consent before using an autodialer to contact a cellphone. If they call a cellphone number that has been reassigned, they have a one call safe harbor to receive constructive notice that the number has been reassigned or is the wrong number. Autodialed calls to consumers who do not answer phones go to voicemail, and many of these voicemail outgoing messages are no more than a synthesized voice repeating the phone number and a generic message, providing no actual notice that the number called does not belong to the consenting patient. Under these regulations, this type of mistake can only be made once. After that, penalties may accrue, and these can be fairly harsh, starting at $500 and rising to $1500 for violations that are willful. There seems to be no leeway in this regulation, so any further autodialed calls may start racking up $500 penalties per call with no way of knowing they are doing so until the cell phone owner actually answers.

This is a particularly bitter pill for medical debt collectors, and unless the regulation changes, this could effectively spell the end of autodialers. Beyond that, however, even physical persons making these calls still receive no notice that the cell phone number is wrong, so any caller who encounters a voicemail outgoing message that gives no indication of the ownership of the number will likely have to list that phone number on an internal blacklist, only potentially to come off when that patient once again provides affirmative consent.

Hospitals in particular should be aware of this order, as they can be held liable for violations when third party vendors act on their behalf and violate these regulations. These new interpretations will no doubt significantly hamper collection efforts at a time when bad debts are increasing dramatically, and healthcare systems must take great care to keep from compounding their losses in these regulatory minefields. The attorneys of McBrayer can assist healthcare entities with compliance issues regarding collections, helping them to negotiate the increasing web of regulations to effectuate positive outcomes. Contact us today.

Christopher J. Shaughnessy is an attorney at McBrayer, McGinnis, Leslie & Kirkland PLLC.  Mr. Shaughnessy concentrates his practice area in health care law and is located in the firm’s Lexington office.  He can be reached at cshaughnessy@mmlk.com or at (859) 231-8780, ext. 1251. We take a team approach to deliver effective counsel to all our clients, so other attorneys in the firm may perform these services as well.

This article does not constitute legal advice.

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