Dinged if you do, dinged if you don’t: Why we need to modernize the TCPA

TCPA has become outdated. It restricts Americans from receiving customer service messages they want – including healthcare appointment reminders, credit card fraud alerts, notifications of travel changes, missed payments, power outage restoration and more. It's time for an update

The Telephone Consumer Protection Act (TCPA) was passed in 1991. This well-meaning legislation was designed to protect consumers from receiving unsolicited telemarketing calls in their homes at all hours – think impersonal mass-audience robocalling with the latest “special offer”.

To prevent these intrusive sales calls, Congress restricted the use of “automatic telephone dialing systems”, broadly limited the use of pre-recorded voice messages and prohibited outreach to mobile phones without “prior express consent” from the call recipient.

Twenty years later, the TCPA has become outdated. It restricts Americans from receiving customer service messages they want – including healthcare appointment reminders, credit card fraud alerts, notifications of travel changes, missed payments, power outage restoration and more. Further, it prevents them from receiving these communications on the device they prefer – their mobile phones.

A changing landscape

At the time the TCPA legislation was passed, over 90% of U.S. households relied on their home or land-line phone. Only 3% of Americans had a mobile phone – they were truly the province of the elite.

So much has changed since then. Today, the trend is away from landline phones – nearly 2 in 5 Americans homes no longer have them – and toward mobile-only households. And a new form of communication – text messaging – has emerged. In 2012, more than 2.19 trillion text messages were sent and received. In 1991, legislators had no way of predicting the growth of the mobile market or the rapid adoption of text messaging as a critical form of communication.

As written, the TCPA allows businesses to contact a consumer’s landline phone for customer service reasons, but requires advanced express consent (opt in) for that same message to be communicated via voice or text to their mobile phone. With penalties ranging from $500 to $1500 per communication, many companies are choosing not to contact mobile devices. This means nearly 40% of consumers, those without land-line phones, are missing out on important communications.

A Classic Catch-22

When newer regulations conflict with the TCPA, businesses are put in an untenable situation. A good example of this can be found in healthcare.

The Affordable Care Act (ACA), passed in 2011, requires hospitals and outpatient clinics to perform post-discharge follow-up with patients to reduce the rate of readmission – a big contributor to the cost of healthcare.  We know the reminders, surveys and education that have proven to lower readmission rates, can be successfully and cost-effectively conducted by phone. However, under TCPA, these calls are high-risk if the patient’s primary contact number is a mobile number and the patient didn’t expressly provide the mobile phone number for that purpose.

Opt-In Is Hard

But how do you get consumers to opt in? Research from consumer psychology validates how hard it is to get people to make a proactive choice.

“Consumers in general are disinclined to participate in programs which require explicit consent. Without significant incentives to participate, it is difficult to get more than 20% of consumers to forego the default option and agree to opt in.”

Dr. Mathew Isaac, Seattle University

I recently spoke with Dr. Isaac about the challenges of TCPA’s express consent requirements and he pointed me to a 2003 research effort that revealed an “opt-out” model yields a much higher rate of success. Specifically relating to organ donor consent, countries offering their citizens the opportunity not to participate saw a significantly higher program participation rate, than those requiring an explicit opt-in.


Where do we go from here?

Recently I went to Washington D.C. to meet with the Federal Communications Commission (FCC), who oversee the TCPA.  I shared with them my belief that consumers are not being well served if the companies they do business with are unable to provide expected levels of customer service. Unintentionally, the TCPA sets companies up to fail by restricting them from delivering desired messages via desired channels.

I think the solution is clear. The TCPA currently allows companies to call a consumer’s land-line with a recorded, non-marketing message. The FCC  could easily extend this exemption to customer service calls and texts made to mobile phone numbers, while mandating consumers be given the option to “opt-out” of these communications. I strongly encourage the Commissioners to consider this change.

In fact, I believe Congress should go further and replace the TCPA.  I envision new legislation called “The Digital Customer Service Act” that would prevent egregious marketing behaviors and enable personalized, timely, digital customer service outreach according to consumer preferences.

In the meantime, Varolii has created an informational website, www.contactcompliance.com, to help businesses better understand the impact of the TCPA and other regulations on their outbound customer communications. I hope you will check it out and share your thoughts.

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David McCann

About David McCann

This was a contributed post by David McCann. To see more content like this, visit the Customer experience section of our blog.