Your ARMor

The UCS Newsletter, providing A/R management and debt collection insights, with the commitment of maintaining the important balance between

Results and Relationships
 vol. 7 issue 3
Table of Contents

The Three Categories: Why People Don't Pay their Bills

Bridging the Gap: The Psychological Business Hurdles of Debt Collection

UCS: All Around Town


"I've worked with United Credit Service, Inc. for over 25 years and have found their staff to be very professional and knowledgeable.  UCS has provided our patients and our staff with outstanding customer service while also providing excellent collection results." 

Director of Patient Financial Services, Large Midwestern Hospital

"Kim is great and wonderful to work with.  Wish all of my medical bills were here."
          a patient


I received a call from a consumer that you recently spoke with who wanted to tell me how wonderful you were to her. She said that you were very polite and patient. She said that you made a difficult situation much more pleasant.

Nice job Becky!!




I would like to say a BIG THANK YOU to one of your associates--Krys for going above and beyond helping the customer. I greatly appreciate everything that Krys has done for me to eliminate my debt in a timely manner.

Thanks,  a consumer

You have been great to work with on this unfortunate issue. Thank you so much for your kindness.  Please apply this check to reference #XX- XXXXXXXXXX

   a consumer


We talk a lot of about financial literacy around here—especially in our blogs. And it’s no wonder. We Americans are woefully uninformed when it comes to understanding the ABCs of finance. But the problem doesn’t end with us. Financial illiteracy isn’t just a concern here in the U.S. it’s a global issue.

A lot of people around the world struggle with money management.

One of the big reasons so many of us have difficulty managing our finances is because no one is talking about it.

As a rule, society frowns on money talk. We are told at a very young age that talking about money is rude.

Not only is talking about money in social settings taboo, but candid family conversations regarding household finances aren’t the norm either. According to data I read from a 2015 Fidelity Investments study a mind-boggling 43 percent of Americans don’t know how much their spouse makes! Let that sink in for a second.  Forty-three percent of us don't know our total household income!

We aren’t the only ones who find conversations about how much we make and spend uncomfortable. Money-talk in Australia is considered distasteful too. A national survey by Suncorp found only 6 percent of Australians said they regularly discuss their salary with family and friends. And even though almost half of Australian parents surveyed said they want to teach their family about the importance of saving only 12 percent are willing to tell their kids how much they make.

Sadly, almost half of us here in the United States think money is the most difficult topic to talk about. And our continued reticence to discuss it has us spending more than we should and often prevents us from asking for help when we don't understand basic financial principles. 

Luckily, The social code around money talk is shifting and younger generations are seemingly more open to discussing money matters. It’s getting to be fairly typical to hear the response to a compliment on someone’s clothing something like, Thanks! Target, $14.50. When I first heard this comeback I was a little taken aback. Now it’s so commonplace I’m more surprised when I don’t hear it.

It's got to start some place, right?!

Don’t get me wrong, I don’t think we are going to be sharing our net worth with the public anytime soon, but this little step of bringing money-matters into the conversation can’t be anything but good.

Best regards,

The 3 Categories: Why People Don’t Pay Their Bills

In a couple of months UCS will be celebrating its 70th birthday. That’s a big milestone! We are very proud of the fact that during these many years we’ve collected hundreds of millions of dollars on behalf of our clients and have helped countless consumers get out of debt.

We’ve seen a lot of changes to our industry during the past 7 decades and have experienced a robust economy, faced the great recession and have witnessed just about everything in between.

We’ve also heard an unbelievable amount of explanations from an inordinate number of consumers regarding their unpaid bills. But, at the end of the day, it typically boils down to just 3 reasons why people don’t pay their bills:

1. There is an inability to pay
2. An unwillingness to pay
3. A mistaken belief of an inability to pay 

One of the first tasks of the collector when talking with a patient (or consumer) is to figure out which category they fall into.

When you read what the media says about our industry and look at all the regulations in place you might think that most debtors fall into the 1st category. But you’d be wrong. Think about it. If most debtors had an inability to pay, there would not be a collections industry. And while we do come across debtors with an inability to pay, they certainly are not the majority.

Category 2 debtors have the money to pay, yet, for one reason or another, they don’t think the bill is theirs or feel they shouldn’t have to pay it. Category 2 debtors can be very challenging, but oftentimes their reluctance to pay is due to a misunderstanding. Once resolved, payment is made. (FYI, if litigation is pursued it will typically be on a debt belonging to a category 2 debtor.)

Category 3 debtors normally don’t have a good handle on their finances. They are the financially uninformed individuals Rick talked about in his letter and are, by far, the largest category.  These debtors have money to pay, but usually find themselves ‘short’ each month because they have difficulty prioritizing their spending. When talking with category 3 debtors, collectors need to put on their financial counselor hats to help them understand their finances, set up budgets, and payment plans both client and consumer can be happy with.

It’s important to point out that this list is not static. A debtor could, let’s say, fall into category 1 today, but six months from now change to a 3. This is why it’s so important to keep making contact, ask questions and update the file each time contact is made. Understanding this dynamic is one of the reasons we are so successful with our Second-Collect and even Third-Collect accounts!

We are very proud of the work we do here at UCS and are happy about the significant positive effect our efforts have on the economic health of our nation, clients and consumers we serve.

Bridging the Gap: The Psychological Business Hurdles of Debt Collection

In your personal or professional life, have you ever encountered one of those decision points where you just get stuck? You weigh a problem that needs a solution but there is no clear direction? Perhaps there is no right answer. Or if there is an answer, it is one we don’t want to choose because it is personally painful. Maybe it is a business or professional policy that limits choice, but we know that to follow the policy to the letter is not the best choice in a particular circumstance?

You are not alone. Even the most decisive people sometimes get stuck.

A case in point is the decision tree our clients often encounter when making the decision about when to turn accounts over to a collection agency like United Credit Service for professional collection action.

Often this decision is clouded by psychological barriers which delay an important action and ultimately cost a business uncollected revenue because a debt becomes harder to collect over time.

The reasons we encounter run the gamut. In the case of many of our smaller clients, the source of the reluctance to turn accounts over to us can be very close to home. That is, their customers live and work in the close-knit communities they serve. Extending the in-house collection process is driven largely by a sense that waiting just a bit longer will produce a ‘wished for’ payment. Unfortunately, once debts go pasts 90 days or so the chance of it being collected by the business drop considerably.

In the case of larger clients, it is often driven by efforts to save costs. That is, doing collections in house is felt to produce a more cost-effective recovery when compared to using a collection agency. So multiple calls, letters and so on delay the ultimate need to engage a collection professional. This costs staff unnecessary time and the business unnecessary expense, when a timely decision to turn the accounts over would encourage faster and more efficient payment.

Further, while collections costs can take a front seat for many larger clients, it is important to keep in mind that it is really the “net-back” number (what is actually collected less commissions) that is the most important. While it may seem at times that a lower commission rate will lead to savings, that is only a very small part of the formula needed to build a successful, cost effective collections strategy. While some companies may offer lower commissions their “net-back” numbers are low, so in reality the client is paying more driven by a lower collections success rate.

We have written quite a bit lately on consumer debt and the ‘tipping point’ we are approaching when the amount of consumer debt outstrips the ability to pay them. This certainly trickles down to businesses pretty quickly.

Joyce M. Rosenberg wrote in an article for the Associated Press (“Businesses find ways to deal with late-paying customers” September 1, 2019): "Small businesses are already taking longer to pay their creditors, according to the PAYDEX index. The index, which reflects payment activity for companies with under $5 million in revenue, fell 0.27% in the second quarter compared with the first three months of the year, according to Dun & Bradstreet Corp., which compiles the index. The index was up 0.15% from a year earlier.”

Additionally, “Customers and clients who are late payers or nonpayers cost small businesses time and money, forcing owners to chase down payments, hire collection agencies and attorneys and file lawsuits. If the economy slows or falls into recession in the near future, it could be even harder to collect from customers — businesses and consumers — who are short of cash.”

We encourage our clients, big and small, to review the barriers that may have been created which delay efficient debt collection. We are the professionals. Let us help!

UCS: All Around Town

Where We Will Be Soon:

October 3-4, 2019

AAHAM Wisconsin Fall Conference​​​​​​​
Where We Are Going Later:

January 22-24, 2020

HFMA Mega Healthcare Conference  
             Hope to see you there!
United Credit Service, Inc.
15 N. Lincoln Street, P.O. Box 740
Elkhorn, WI 53121