What happens when a medical bill gets sent to collections? This is a question that many individuals face after receiving unexpected medical expenses. When a medical bill is sent to collections, it means that the original debt has not been paid within the agreed-upon timeframe, and the healthcare provider has decided to turn the debt over to a collection agency. This process can have significant consequences for both the patient and the healthcare provider, and it is important to understand the implications and steps that can be taken to resolve the situation. In this article, we will explore the various aspects of what happens when a medical bill gets sent to collections, including the reasons behind this action, the impact on the patient’s credit, and the available options for resolving the debt.
Reasons for Medical Bills Being Sent to Collections
There are several reasons why a medical bill may be sent to collections. One common reason is that the patient did not have insurance coverage at the time of the service, or the insurance company denied the claim. Other reasons may include administrative errors, such as incorrect billing information, or the patient simply failing to pay the bill. In some cases, the healthcare provider may have mistakenly sent the bill to the wrong address or to the wrong person.
Impact on Credit
When a medical bill is sent to collections, it can have a negative impact on the patient’s credit score. Collection accounts are considered a form of debt and can stay on a credit report for up to seven years. This can make it difficult for the patient to obtain new credit, such as a mortgage or car loan, and can even affect employment opportunities in some cases.
Options for Resolving the Debt
There are several options available for patients who have medical bills sent to collections. The first step is to contact the collection agency and negotiate a payment plan. Many collection agencies are willing to work with patients to establish a manageable payment schedule. Additionally, patients can try to negotiate a settlement with the healthcare provider to reduce the overall debt amount. In some cases, the healthcare provider may be willing to forgive a portion of the debt if the patient can demonstrate financial hardship.
Legal Considerations
It is important to note that patients have legal rights when it comes to medical debt collections. Under the Fair Debt Collection Practices Act (FDCPA), collection agencies are prohibited from using abusive, deceptive, or unfair practices to collect a debt. If a patient believes that a collection agency has violated these laws, they can file a complaint with the Federal Trade Commission (FTC) or the Consumer Financial Protection Bureau (CFPB).
Conclusion
When a medical bill gets sent to collections, it can be a stressful and overwhelming situation for patients. However, understanding the reasons behind this action, the impact on credit, and the available options for resolving the debt can help patients navigate this challenging situation. By being proactive and seeking assistance from healthcare providers, collection agencies, and legal resources, patients can work towards resolving their medical debt and protecting their credit.
