Unlike banking, insurance or other financial services, debt-collection currently falls beyond regulation's reach.
There are no regulatory bodies in place, a Department of Finance spokesman confirmed. "We don't authorise debt-collection agencies. They are not covered by the Central Bank and Financial Services Act, 2003."
"The Consumers Association of Ireland would be calling for regulation of these agencies," said spokesman Eddie Hobbs. "A debt-collector seems to be trading in cash-owed. That activity should come under the Investment Intermediaries Act as a 'qualifying instrument'. It takes a percentage of debt recovered. It is a financial service. Yet it is not regulated by the Irish Financial Services Regulatory Authority."
"It does appear unusual that the health service would delegate this service to someone other than the law society," he added. "Solicitors can be held to account. For any state body to hire a non-regulated body is asking for trouble."
Michael Brophy, who deals with health sector complaints at the Ombudsman's office, said: "The Ombudsman's office is complaints-driven and we have not received complaints about this practice to date but for a public body to use a non-regulated agency is probably not good practice. If they are unregulated because the law doesn't encompass them, maybe it is a matter for the Department of Finance."
Micheal Culloty, spokesman for the Money Advice and Budgeting Service (Mabs), said: "Usually people who can't pay these costs are low-income or on social welfare, and any expenditure would put pressure on them. But a hospital visit is not like other expenditure. People may not be in full-health when they get these letters. Letters like these can have an inordinate effect that is disproportionate to the amount owed."
Culloty also cites Scandinavian research showing a strong correlation between indebtedness and ill-health. "Either the illness causes the over-indebtedness or people become ill because of the anxiety over their inability to manage their money," he said.
"When people come to us because they can't afford to pay, we find the hospitals are accommodating. It is those that don't seek assistance that I would worry about. The health service must have processes in place to recover revenue. But you would prefer a different process for vulnerable people and small amounts."
Mabs has multiple offices in every county. Local office contact details are listed in the phone book, and at www.mabs.ie.