Little Things that Make Big Impact

Remember the book “All I really needed to know I learned in Kindergarten” by Robert Fulghum? In it Fulghum lists a bunch of kindergarten rules that stand the test of time and remain relevant into adulthood.  Things like: share, play fair, don’t hit people, clean up your own mess, don’t take things that aren’t yours, say you’re sorry when you hurt someone, and many more.  You get the gist. I think what’s made the book so popular (in print since 1989) is its simplicity. It’s all very basic—stuff we all know, can agree with and relate to while also being very essential.  It’s one of those things that we read, see, or play (think hula-hoop) and think, why didn’t I come up with that?

Here’s the thing, I think we all can come up with them—the little things in life that can make a big difference.  All we have to do is remember the Golden Rule: do to others as you would have them do to you, and go from there.  We all know how we like (or don’t like) to be treated—that’s the easy part.  The harder part is the follow through.  Here are 3 of the little big things I’ve come up with.

 

  1. Say thank you

We’ve all been taught this, but do we say these two words or show our appreciation as often as we should?  I know this might sound petty, but when I’m driving I’m usually happy to stop and let someone in, but if I don’t get the nod it actually ticks me off. The nod—the thank you—is important to me. So, if showing gratitude is important (and I’m telling you it is) for something this insignificant, guess how much it means in the big scheme of things! We all love to get positive feedback. Wouldn’t the world be a better place if we all showed our appreciation for one another?

  1. Everyone needs help from time to time

But a lot of people just aren’t comfortable asking for help. This is where it gets a little more complicated: if you are one of those people who don’t ask for help because you think it will make you look weak or are afraid people will lose respect for you, guess again. Asking for help will not only benefit you, the person or people who help you will get to feel like a valued part of your life or business.  Remember, admitting you don’t have all the answers and need help from others is a way more admirable trait than being a know-it-all!

On the flip side, there are those who have trouble asking for help because they don’t want to appear needy or may feel like they aren’t in a position to ask for help.  Asking others if you can be of assistance to them sometimes gives them permission to ask for or accept help. In either case, asking for or offering help results in a win-win for everyone.

  1. Everyone needs to be seen

I’m not talking about being the center of attention, not everyone craves or enjoys being in the spotlight. Everyone already acknowledges the big achievements, what I’m referring to are the little things that really aren’t that little: Like the employee with young children who was having trouble getting to work on time who is now regularly clocking in on time.  Or the person who regularly refills the copiers with paper and ink so they are always ready when we need them. It’s important to let people know they are seen—especially when doing stuff right.

There are so many little things that can make a big impact on our lives and the lives of those around us.  Which ones are important to you?

A. Alliance Collection Agency, Inc. is a full service, licensed accounts receivable management and debt collection agency providing highly effective, customized one on one management and recovery solutions for our business partners.  Founded in northern Illinois in 2005, we have been proudly improving the bottom-line on behalf of our business partners in and around Chicagoland for over 13 years.

 

image provided by: Addy Lake

How High is Too High? Consumer Debt Reaches $13.29 Trillion!

Well it is that time again.  Time to get a little wonky and update you all on the state of consumer debt.

The headline?  According to the New York Federal Reserve, we have reached yet another record for total household debt:  a whopping $13.29 trillion!

I don’t know about you but to me $13.29 trillion is a big number.  Perhaps a number that big is meaningless until we actually look at it like this:  $13,290,000,000,000.

So how much is that really?  To put it in perspective, according to Wikipedia, the Gross Domestic Product of the United States of American in 2017 was $19.3 trillion.  The European Union as it is presently comprised was $17.3 trillion.  After that, our debt exceeds the GDP of countries as large as China and Japan, and dwarfs the GDP of the individual members of the EU and every other country in the world.

Frankly I find that stunning.

And there does not seem to be an end to this record setting trend.

Here are some key statistics from the New York Federal Reserve in their report for the second quarter of 2017 (read the summary here, published in August, 2018):

  • Total household debt rose to $13.29 trillion, increasing for the 16th straight quarter.
  • We added another $82 billion in household debt during this period.
  • Since we are talking record books here, this is $618 billion higher than the previous peak reached in the third quarter of 2008.
  • The New York Fed points out “…overall household debt is now 19.2% above the post-financial-crisis trough reached during the second quarter of 2013.”

Some specifics:

  • Mortgage originations edged up to $437 billion.
  • Mortgage delinquencies improved: 1.1% of mortgage balances are 90 or more days delinquent versus 1.2% in the first quarter.
  • Auto loan balances increased by $9 billion in the quarter, to $1.24 trillion.
  • Credit card balances increased by $14 billion, or 1.7%

What about Delinquencies?

According to Wilber van der Klauw, the Senior Vice President at the New York Fed: “While overall delinquency rates have remained stable at relatively low levels, transition rates into delinquency have fallen noticeably for student debt over the past year, reflecting an improved labor market and increased participation in various income-driven repayment plans.”

One could certainly say that last is very good news for those who have faced the bleak prospect of repaying huge student loans.

Some other notes from the New York Fed:

  • Credit card delinquency rates went down slightly: 7.9% of balances are 90 or more days delinquent as of June 30, versus 8.0% at March 31.
  • The number of credit inquiries in the past six months (an indicator of consumer credit demand) basically remains unchanged. The Fed points out that this is among the lowest levels seen in the history of the data.
  • Consumers with an account in collections fell 23.4% between the third quarter of 2017 and the second quarter of 2018, from 12.3% to 9.4%, largely due to changes in reporting requirements of collections agencies.

With regard to this last point, several members of the New York Fed published a companion blog titled “Just Released: Cleaning Up Collections” (see cite below* and read it here) which specifically addresses the changes in credit reporting requirements and how they affected credit scores.

“The downturn was a result of a change in the required reporting practices that impacted collections accounts specifically, known as the National Consumer Assistance Plan (NCAP), which rolled into effect during the second half of 2017.”  They point out that those benefiting the most were individuals with low credit scores to begin with.

“All in all, the changes in credit reporting prompted by the National Consumer Assistance Plan have resulted in an $11 billion reduction in the collections accounts balances being reported on credit reports. A total of 8 million people had collections accounts completely removed from their credit report.”

They go on to say: “However, collections accounts do indeed align with other negative events and the cleanup of collections accounts had the largest impact on the borrowers with the lowest scores. These borrowers will certainly benefit in the long run from the cleanup of their credit reports, since higher scores are associated with better access to credit, to the job market, and even to the rental housing market.”

Yet there is a warning here (emphasis added): “…But the immediate impact of the removal of collections will be muted if the beneficiary’s credit record continues to be tarnished with other negative information…We also think that in the longer-term there may be a rebound in collections account reporting because creditors will likely begin collecting the newly required personally identifying information as they adjust to this reporting change.”

Thus, while credit reporting continues to be a vital tool for both the collection industry and businesses extending credit in general, this change may have the unintended consequence of providing easier paths to credit for those who may be already be financially on the edge.

Good news, bad news?  So it would seem.  As long as the economy continues to be healthy and employment high, these high debt levels seem to be sustainable.  However, vigilance is again strongly suggested when monitoring the status of receivables.  Staying on top of delinquent accounts is critical to a company’s financial health. We are here to help!

A. Alliance Collection Agency, Inc. is a full service, licensed accounts receivable management and debt collection agency providing highly effective, customized one on one management and recovery solutions for our business partners.  Founded in northern Illinois in 2005, we have been proudly improving the bottom-line on behalf of our business partners in and around Chicagoland for over 13 years.

image provided by: https://www.mises.ca

Improving Your Collection Success by Enhancing the Customer Experience

I hope it is no surprise that the experience your patients/customers/clients have with your organization can significantly impact your bottom line.

The cost of dissatisfied consumers is very high.  In highly competitive business environments it does not take much to spread the word about even a single service snafu.  That impacts both new business and return business.  I don’t care what industry you are in, poor service perceptions negatively impact growth, and also can increase bad debt.

Our business is the collection of debts, and we have been successfully collecting them for our clients for more than 65 years.   One thing we have learned is that quality of service is often linked to the amount and quality of bad debt we receive from our clients.  Right or wrong, poor service often provides a natural incentive to delay payment.

Although this blog will focus on efforts in the medical community to improve the service experience, doing a few simple things better can often yield big results for any industry.

Focusing on just a few key areas can help improve processes, increase patient/customer satisfaction, improve payment receipt times and reduce bad debt.  In addition, if the debt needs to be turned over to a collection agency like UCS, the debt collection process itself becomes more streamlined and efficient improving results and getting payment faster.

In the February 7th edition of “Collector” magazine, editor Anne Rosso May writes about some of these seemingly simple things providers can do to improve their processes and create a more integrated and effective relationship with their patients, internal stakeholders and third party agencies.

  • Take a holistic view of the process: May points out that “In the years since the Centers for Medicare and Medicaid Services started tying hospitals’ reimbursements to their patient experience scores, healthcare providers have become well aware of the financial incentives that come from happy patients.”  May encourages a ‘holistic’ view of business practices “…to make sure every aspect of a patient’s experience, from the initial intake to the bill in the mailbox, is friendly, easy to understand and compassionate.”

 

  • Clarify your written communications: Review all of the communications sent to your patients/customers to ensure they are well written and the content easy to understand.  Perhaps most importantly this includes the bill. She cites a “…recent survey from Mad*Pow, a design agency, [which] found that a whopping 62 percent of patients found their medical bills confusing.”  Confusion about the bill, and the cost of increased call volume to call centers, directly impacts the bottom line.  Avoid the use of overly technical terms, overly detailed billing codes, the use of fine print or other confusing content.  Consider formal or informal ‘focus groups’ of patients/clients to review content and optimize the layout to encourage ease of understanding and prompt payment.

 

  • Fine tune all verbal communications: Review how verbal communications are being delivered by customer contact personnel, including third party collection agencies. Partner with them to ensure that consistency of message and delivery is maintained. UCS encourages a ‘compassionate’ approach to collections and we find that the human touch can pay dividends when working with otherwise difficult debt situations.

 

  • Simplify the payment process: Not all payment channels work for every provider but do you offer the ones that consumers come to expect?  Not just pay by phone, but also web pay, mobile pay and other similar payment channels?  The idea, of course, is to make paying as easy as possible and to break down barriers that discourage timely payment.

 

  • Embrace the changes: Consumers do have many choices when they look for service providers, whether in the medical field or elsewhere.  “By paying attention to patient [/consumer] behavior, both how people spend their money and how they communicate with your staff, you can create an environment that takes a difficult situation—an injured child, an ailing mother, a car accident—and turns it into an opportunity to connect with and help people.”

We strongly believe that creating a strong and mutually supportive relationship between all parties creates a more efficient and effective process of consumer interaction and debt collection.  We are here to help!  Ask us how.

A. Alliance Collection Agency, Inc. is a full service, licensed accounts receivable management and debt collection agency providing highly effective, customized one on one management and recovery solutions for our business partners.  Founded in northern Illinois in 2005, we have been proudly improving the bottom-line on behalf of our business partners in and around Chicagoland for over 13 years.