As we mentioned in Januarys newsletter a high percentage of consumers each year use their income tax return to pay off past due bills. As our first artricle in this months newsletter illustrates a larger than expected number of consumers plan on using their tax rebate checks to due the same.

If you have not gone through your 2007 past due accounts and placed them with us there has never been a better time to do so. Our new website at www.swrecovery.com allows you to place your accounts online with 24/7 access it has never been easier to place your past due accounts. Please call Steven Dietz at 866-558-DEBT Ext. 112 if you would like to learn how to place your accounts using our secure web portal.

As always I would like to thank you my customer for allowing me the opportunity to service your collection needs. I truly appreciate you and your continued business.

Consumers Plan to Use Tax Rebate to Pay Down Debt
Published: February 29, 2008
.According to a new National Retail Federation survey, conducted by BIGresearch, consumers plan to spend 40.6 percent of tax rebate checks when they are distributed later this year, which will provide an immediate $42.9 billion boost to the economy.

“To spend or save?” may be a question many analysts are asking about tax rebate checks, though a new survey finds that many families are planning to do both when the checks are distributed.
According to a new National Retail Federation survey, conducted by BIGresearch, consumers plan to spend 40.6 percent of tax rebate checks when they are distributed later this year, which will provide an immediate $42.9 billion boost to the economy. The survey also found that the $105.7 billion distributed in tax rebates will be used to pay down debt ($30.0 billion), saved ($19.8 billion), invested ($4.4 billion), and used to pay down medical bills ($4.6 billion).

“Tax rebate checks should have the desired effect of both bolstering the economy in the short-term and putting consumers in a better position to spend for the future,” said NRF President and CEO Tracy Mullin. “This stimulus package is a crucial component to economic recovery and will provide much-needed relief to American shoppers.”

President Bush recently signed H.R. 5140, the Recovery Rebates and Economic Stimulus for the American People Act of 2008. The $152 billion measure will provide tax rebate checks of up to $600 per working individual and $1,200 per married couple, plus $300 per child for families with children and new tax incentives for job-creating business investments.

“Many Americans will be wisely using their rebate checks to save, spend, and pay down debt, so the overall result will be positive for the U.S. economy,” said Phil Rist, vice president of strategy for BIGresearch. “While some will splurge on big ticket items, many consumers will use the checks for important day-to-day purchases.”

While women will spend a larger percentage of their rebate check than men (43.6 percent vs. 37.3 percent), both genders will plan to set aside the same percentage for savings (18.7 percent). Young adults 18-24 will spend more of their checks (46.2 percent) than any other age group.

Working with Today’s Transparent Consumer
Published: March 7, 2008
Medical transparency initiatives may affect the consumer’s attitude and willingness to pay.

If you did a Google search for “hospital prices,” one of the first sites you'd see is www.hospitalvictims.com, developed specifically for those affected by what the site calls “financially impossible” hospital charges. The site aims to educate consumers by giving advice about negotiating hospital charges and recommending affordable hospitals. The site is just a glimpse in to the world of pricing transparency, which is affecting all key players in the healthcare receivables market—in good ways and bad.

According to Bill Griffin, vice president of corporate finance at Baptist Memorial Healthcare Corporation in Memphis, Tenn., and Keith Siddel, chief executive officer and president of Hospital Resource Management in Creede, Colo., the initial intention of medical transparency were to help consumers by creating openness, communication and accountability, but the effects of medical transparency have reached far beyond that.

Take hospitals, for example, that are being affected by their own initiatives, as well as initiatives from their state hospital associations, state government Web sites, global hospital initiatives, and much more.

Griffin said Dartmouth-Hitchcock Medical Center is an example of one hospital that was an early contributor to pricing transparency. The hospital introduced an out-of-pocket estimator that gave patients a ballpark estimate of costs by using deductible, co-pay and co-insurance information to produce pricing estimates. The tool had benefits, Griffin said, but also limitations. The estimate only calculated a limited number of procedures and depended largely on the individual's insurance company.

Hospitals are also meeting initiatives from state hospital associations that have Web sites comparing statewide hospital prices. Hospitals have to be careful about the type of information that gets posted on Web sites to make sure it gives patients an accurate picture of estimated costs, Griffin said.

Medical tourism and Web sites encouraging consumers to challenge hospitals are just a few of the other factors in the pricing transparency mix that are creating consumers who are more informed and empowered to make their own decisions about healthcare. Consumers are becoming skeptical and tired of turning over large portions of their income to healthcare.

For collection agencies, medical transparency may affect the consumer's attitude and willingness to pay. Will the consumer be reluctant to pay because he or she received a price estimate that was different than the actual bill? Will the consumer be skeptical that the charged amount is just a ploy from the hospital trying to make money? Time will tell, but the credit and collections industry will need to be ready to work with today's consumer.

This article is provided as a service of ACA International's Healthcare Services Program.

This article is based on Bill Griffin and Keith Siddel's Fall Forum session, “The Price is Right…Pricing Transparency,” presented Nov. 13, 2007, at ACA's Fall Forum in Memphis, Tenn.

IRS Extends Private Debt Collection Program
Published: March 7, 2008
On March 4, the Internal Revenue Service extended the Private Debt Collection initiative through 2008 by renewing the contracts of the two collection agencies currently working on the program—Pioneer Credit Recovery Inc. and The CBE Group Inc.
The Private Debt Collection initiative represents a public-private partnership between the IRS and collection agencies to recover delinquent tax debt and close the $345 billion tax gap. It began in September 2006 and has made significant progress in recovering unpaid taxes, bringing in more than $41 million dollars as of December 2007. If the program is allowed to expand to full implementation, the IRS expects it to collect more than $2.2 billion.

Under the program, the private collectors are only authorized to locate and contact taxpayers and request and accept payment. The power to assess tax, negotiate amounts due, issue liens, seize property, garnish wages or initiate any other type of enforcement action remains solely with IRS. Moreover, any questions or problems encountered by the PCAs are immediately directed back to the IRS. This design allows the IRS to focus resources on larger, more complex cases while private collectors assist in recovering uncontested tax debt.

ACA International believes this valuable program should remain in place. To that end, in August 2006 ACA formed the Tax Fairness Coalition. The coalition is composed of interested ACA member companies, including the private collection agencies under contract with the IRS. Through special lobbying and public relations efforts, the coalition has thus far been successful in thwarting several attempts to end the program. For more information on how to become involved in the Tax Fairness Coalition, please contact ACA's Government Affairs Department at +1(952) 926-6547, or e-mail govaffairs@acainternational.org.

This article is provided as a service of ACA International's Legal and Government Affairs Department.

House Overwhelmingly Approves Bill to Address Rising College Prices
Published: February 29, 2008
The U.S. House of Representatives voted overwhelmingly on Feb. 7, 2008, to address the soaring price of college and remove other obstacles that make it harder for qualified students to go to college.

By a bipartisan vote of 354 to 58, the House approved the College Opportunity and Affordability Act (H.R. 4137), which would reform and strengthen the nation's higher education programs to ensure they operate in the best interests of students and families.

“Last year, by enacting a $20 billion increase in federal student aid—the largest increase since the G.I. Bill of 1944—this Congress took an historic step to help American families pay for college,” said U.S. Rep. George Miller (D-Calif.), the chairman of the House Education and Labor Committee. “Now we are redoubling our commitment to college students and parents by reining in skyrocketing tuition prices and making our whole system of higher education far more consumer-friendly.”

An October 2007 report from the College Board showed that, over the previous five years, tuition and fees had increased across the board, at public and private colleges and at two-year and four-year colleges. The bill would address these rising prices by encouraging colleges to rein in price increases, ensuring that states maintain their commitments to higher education funding, and providing students and families with consumer-friendly information on college pricing and the factors driving tuition increases.

The legislation also strengthens provisions previously approved by the House to avoid conflicts of interest in the student loan programs. The bill's new provisions include requiring better consumer disclosures and protections on private student loans. The lawmakers said that these new protections form a Bill of Rights for college consumers.

In addition, the College Opportunity and Affordability Act would:

• Streamline the federal student financial aid application process.
• Make textbook costs more manageable for students by, among other things, helping them plan for textbook expenses in advance of each semester.
• Allow students to receive year-round Pell Grant scholarships
• Strengthen college readiness programs.
• Increase college aid and support programs for veterans and military families.
• Improve safety on college campuses and help schools recover and rebuild after a disaster.
• Ensure equal college opportunities and fair learning environments for students with disabilities.
• Strengthen our nation's workforce and economic competitiveness by boosting science, technology, and foreign language educational opportunities.

H.R. 4137 is the second of two major higher education bills passed by the House in the 110th Congress. The first, the College Cost Reduction and Access Act, was signed into law in September 2007. H.R. 4137 is a comprehensive reauthorization of the Higher Education Act, the primary federal law aimed at expanding college access for low- and middle-income students.

For more information on the College Opportunity and Affordability Act, visit http://edworkforce.house.gov/micro/coaa.shtml.
This article is provided as a service of ACA International's Government Services Program.

March for Success with Technology
Published: February 29, 2008
The Fair Debt Collection Practices Act became law at a time when the influence of technology on communication was minimal. There is not a one-size-fits-all approach for handling the compliance issues posed by e-mail, voicemail, cell phones, autodialers and more. That’s why ACA is pleased to present a two-and-a-half-day track on technology and related compliance issues at March for Success in Las Vegas, April 9-11, 2008.

Technological advances in recent years have heralded a new age of communication and efficiency in the business world. Such developments have changed the face of communication in both our personal and professional lives. No longer must we sit by the phone waiting for a call.

Today's rampant use of cellular phones has allowed us to be mobile and, should we miss a call, voicemail is there to answer and obtain a message on our behalf. Electronic messaging and fax technology have allowed us to eliminate the aggravating game of phone tag and quickly transmit our messages. Caller identification has taken the guesswork out of answering a call. While technology often enhances our lifestyles, it can be a hindrance from a compliance standpoint.

For the collection industry, many communications, including those aided by technology, are regulated by the Fair Debt Collection Practices Act (FDCPA). The FDCPA became law in 1978 at a time when the influence of technology on communication was minimal. Almost 30 years later, technology such as fax machines, automated dialing assistance, voicemail, cellular phones, e-mail, the Internet and more are employed on a daily basis in our offices and homes. The FDCPA did not anticipate these new means of communication, and the industry has received little guidance over the years about the FDCPA's applicability in our modern business environment.

Unfortunately, along with the conveniences of technology come new pitfalls for those obligated to observe state and federal restrictions on communication. In addition to the FDCPA, other federal and state laws were also passed before the utilization of technology, and unfortunately, such laws did not contemplate how the use of such technology would comply with the existing law or interact with other laws. This often leaves collectors and courts to grapple with the issue of compliance.