Least Sophisticated Consumer

Shawn Gretz,
VP of Ridiculously Nice Sales

I love TED talks. A recent one by Rutger Bregman titled, “Poverty Isn’t a Lack of Character; It’s a Lack of Cash,” had us at Americollect thinking about the “poor” in a different light. Go ahead, stop reading this article and watch the first five minutes or so.

Watch it Now!

If you watched the full TED talk, this article is not taking a stance on agreeing or disagreeing with Rutger’s proposal of instituting a guaranteed income. I do, however, agree with much of what he says in the first five minutes. So, why do poor people make so many bad decisions? Why is it that statistically poor people:

  • borrow more
  • save less
  • smoke more
  • exercise less
  • drink more
  • eat less healthfully

A common argument, that Mr. Bregman himeslef self-proclaimed, is that “there’s something wrong with them. If we could just change them, if we could just teach them how to live their lives, if they would only listen.” Them being “the poor”. But something changed Mr. Bregman mind. That something was a study published Eldar Shafir, a Princeton Professor, who learned that when a person is “poor” they have a corresponding loss of IQ. Mr. Bregman compared it to the loss of a night’s sleep or being drunk. Now, most of us know the feeling of both and I’d like to think my IQ remains the same when I had a few drinks, but let’s take lack of sleep for a day. I remember the haze I was in after my son Trevor was born.  We had a rough first year where Trevor loved to sleep 2 hours at a time and then stay up an hour until his next “nap”. There were some days when I would go to work on a total of 3 hours of sleep. I know my IQ wasn’t anywhere close to where it is with a full-night’s sleep. It goes on to say that a person who is “poor” has a “scarcity mentality”. Your IQ decreases when you are searching for what is scare as in “time, money, or food” and let me add health or worried about the health of a loved one or child.

The mind of someone who is struggling isn’t making bad decisions because of who they are but more so because of “where” they are in life. The mind is being overloaded on where the next meal will come from, how to pay the rent, and how to get themselves or family healthy again. Think of it like a computer that has a bunch of programs opened at the same time and running very slow. The computer is overloaded because of all the items you are asking it to do at once. How does this relate to the “Least Sophisticated Consumer”?

The Fair Debt Collection Practices Act (FDCPA) is a regulation that collection agencies are required to follow. In the FDCPA, the “Least Sophisticated Consumer” is the regulation standard for which communications can occur with patients. It ensures that we don’t overload the patient when discussing bills.  That is exactly why Americollect works on being Ridiculously Nice in early out and collections. Patients prefer to communicate with an agency that understands that a person struggling today could be overloaded. Americollect helps patients understand by explaining away the complexities of healthcare with well trained healthcare collectors on items such as preventative vs. diagnostic treatments or facility vs. physician charges. This creates a relationship of trust with the patient and helps Americollect recover more money while satisfying patients and clients. Remember the next time you are on the phone with a struggling patient, their brains could be overloaded with many, many more important scarcity items.



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