Department of ED Releases First Performance Reports for New Collection Contract

The U.S. Department of Education (ED) recently released the first performance report rankings for its 2009 student loan debt collection contract.  A performance report was also released for 2004 contractors.

In early 2009, ED awarded a new student loan debt collection contract to a total of 22 collection agencies (“ED Announces Debt Collection Contract Winners in Unrestricted Category,” Jan. 9, 2009; “Department of Education Names Small Business Collection Contractors,” March 11, 2009), five more than were on the previous contract, awarded in 2004. The vast majority of the collection agencies on the 2004 contract were retained, with most of the small business contractors moving up to the unrestricted category.

Even though both contracts are still running, all new accounts have been placed with 2009 contractors since November 2, 2009. According to ED, all accounts from 2004 contracts will be returned and and distributed to the 2009 contractors after two years.

The December performance rankings saw Pioneer Credit Recovery and NCO Group dominate among the 2009 restricted agencies with a total scores of 94.96 and 94.57, respectively. The next closest agency in the unrestricted category – reserved for large ARM firms – was Van Ru Credit Corp. with a score of 73.52.

ED’s performance scores are based on a weighted average of performance metrics, including total dollars collected, total accounts serviced and administrative resolutions. The scores are released each month, but compiled for internal scoring on a quarterly basis. Final quarterly rankings determine bonuses and account placement levels.

Through the end of December, Pioneer had collected the most for ED, with $882,052 brought in. NCO was slightly behind with a total of $827,015.

In a new line-up of collectors on the small business set aside contract, Coast Professional, Inc. demolished the competition with a total score of 85.60 and $324,837 collected. Delta Management Associates took second place in the small business category with a score of 77.70 and $258,250 collected in the first two months of the new contract.

Meanwhile, CBE Group topped the rankings among large collectors on the 2004 contracts by gaining perfect scores in two of the three performance indicator categories with a total posted score of 99.27. Pioneer and Van Ru followed for the silver and bronze.

Premiere Credit posted a perfect score of 100 on the small business set aside contract for 2004. Continental Service Group (Conserve) came in second with a score of 97.53.

The 2009 contactors have collected a total of $10.8 million in two months for the Dept. of ED, while the 2004 contract has brought in $6.9 billion in its 58 months.  

<<< Return to Newsletter