You Tom have brought up an angle that I never considered, the tax liabilities of the people involved. It might be very well as you suggested where the doctors group is just making too much money,
I need to look at a way to put into his reply a way that if they sell this "account" to some other collection service that he can some how go back on them for any expenses incurred or at least he can than start sending them bills for his time to deal with it.
This kind of stuff is time consuming and what people need to realize is that when you get one of these letters from a debt collector that if you don't respond and dispute it within the 30 day time frame you are agreeing that you owe the debt.
This needs to be done when you get the very first letter, otherwise if you just disregard it, they will end up taking it to court and getting a default judgement against you.
In the end it might just be easier to pay the damn the thing but it is a matter of principle.
If he were to pay it and he was getting scammed it would just encourage these type of people to continue scamming people. On the other hand if it is a legitimate debt and he does owe it this might make this outfit get their ducks in row and start operating like businesses should.
If this isn't legit it would surely be a federal offense of mail fraud that the government might need to be made aware of. Only time will tell, and we just have to see how it all plays out.

The insurance and kids and power of attorney is something that everyone also does need to be aware of, what a mess that arena has become. Pretty much because as you noted with the players in that game too.