Medical bill collection ethics Iowa

[Mama84]

The hospital charges amounted to $2000.00. It took over a year for them to engage in billing and collection efforts. Due to a hardship request the bill was reduced by almost 1/2. Payments are being made monthly via a CCCS arrangement, however a 3rd party collection service continues to call and insist on larger payments or payment in full.
3rd party has now filed in small claims court for the balance, which appears inflated because of payments made against the reduced balance due.
Just wondering if anyone knows the legality of filing small claims when they have been accepting payments for the last 6-12 months.