My receivables problem began and continued to grow that way. Successive office managers inherited the old baddies and in the course of their tenure (with the best of intentions) allowed new ones to sprout like weeds. I learned that accounts receivable problems vary with practice management policies and strategies, which are often controlled by the aptitudes and preferences of the staff in charge of accounts receivable.
Before computers it was very difficult to keep track of accounts that were 30, 60, and 90 days overdue. During the past seven years I have become dependent on not less than four computers to assist in managing the various aspects of the office. It became extremely easy to spot the baddies; one had only to look over the monthly practice statistics report, or the "on-demand" report of the "90 day overdue" patients, to know what new baddies had begun to sprout. My computer reports forced me to see my patients in the cold light of financial reality. Each bad whom I identified was an object lesson in poor practice management.
Slowly I identified those practice policies and personal attitudes about collection that were my undoing. Slowly I began to correct the policies that were underlying and nurturing my growing accounts receivable problem. In due time I developed criteria for initiating litigation and instituted interceptive and preventive measures to minimize the new sprouts.
My collection problem had grown uncomfortably large and I attacked the problem using a variety of strategies. Gradually, I focused primarily on the Small Claims Court because there I had the most control of the outcome.
I came to realize how ineffectual most collection agencies are. I remember one agency that collected some fees for me and then went bankrupt, taking my share along with it.
This was the moment of truth for me. Collection attorneys were also out of the question since they wanted 35% -50% of the "gelt" I worked so hard to earn. Taking my bad debt losses as a tax write-off occurred to me as a very early solution. My accountant has patiently explained to me at least three times why this is not possible for a "cash-basis" taxpayer. I accepted what he said; I'm an orthodontist not an accountant.
Caught between a rock and a hard place, and being neither passive by personality nor willing to forgo my fee, I turned to the court, no doubt also motivated by its proximity to my office and home.
My experiences over the course of fifteen years number well over a hundred cases in the Small Claims Court. An attorney, a patient of mine, ventured to say that I was perhaps one of the most proficient, if not the most experienced, non-lawyer using the court.
This guide contains the details of all the procedures involved in the Small Claims process and the myriad pitfalls which I have experienced. You will meet with these pitfalls unless you take heed of the precautions I outline. I hope my experiences will encourage the reader to use the Small Claims Court with less timidity.
The litigious approach admittedly is an "in your face" way of getting your debtor's rapt attention and may not be suitable to some service providers whose personality types are less than comfortable in a confrontational situation. Being prepared may give the reader more confidence to resolve and overcome this problem.
The sum of my experiences in court have reinforced my belief that in some cases the only way to confront the non-payment issue is in an impressive, formal environment such as that offered by the Small Claims Court. In essence you are fully awakening and alerting the debtor to the responsibility of his/her bill and the seriousness of your intentions to collect it.
THE GOALS AND APPLICABILITY OF THIS BOOK
The guide's contents will provide you with the necessary "tools" and understanding you need to navigate the do-it-yourself "Pro Se" court system with a minimum of discomfort, and to let you emerge unscathed with the payment due for your services or goods, whether they be for professional services or in any other field where services or goods are provided to a patient, customer or client. The principles are no less valid for money lent to a "friend."
The information provided in this book is generally applicable to every Small Claims Court in the United States. The forms, fees, procedures, and terms may vary from one locale (county) to the next and from time to time may vary even in the same locale. For example, on a visit to Oregon I discovered that in Deschutes County not only must the plaintiff pay a filing fee of between $36.00-$73.00, but the defendant must also pay a fee of between $20.00-$34.00 if he should demand a hearing. Also, outside of New York City, you are likely to request a "continuance" rather then an "application" when you need to postpone your hearing to a future time.