Countless times, medical bills are sent to collections of unsuspecting victims who have no idea what they are in for. It does not matter if your bills are paid in a timely manner and that you maintain a good credit report, chances are that medical bills you might have no idea about could be affecting your credit adversely. As a matter of fact, it has been reported by the Consumer Financial Protection Bureau that approximately 31.6 percent of individuals might be susceptible to having collections accounts joined to their credit reports. The following are some medical bill falsehoods that could be detrimental to your credit report, and some tips on how to tackle such problems.
Despite you paying for your medical bills, they still end up in your collections
Even if you are attempting to pay for your medical bills, they could still be getting sent to your collections. For instance, under the circumstances that you are paying in portions, or paying late while being under a payment arrangement, your provider might still send your medical bills over to collections.
To be able to tackle this problem of medical bills ending up in collections, get the provider to establish an arrangement for payment, and have them get it in written form. If, for example, you both agree to you recompensating a debt in a matter of six months, the provider should have no reason to send the bills to your collections after the arrangement.
Insurance coverage limits
Most people commonly believe that their insurance is responsible for covering all medical bills and that they do not have to make the payments, but on the contrary, the insurance companies misunderstand medical bills and do not cover them, even when your policy is meant to cover medical bills. You can tackle this by reading the bills thoroughly, searching for inconsistencies, and informing the insurance about them, and if the bill is too complicated to understand you can seek help from a billing expert in medicine.
A fact about medical collection accounts
One positive aspect to note is that medical bills are put under a different category compared to other bills being sent to collections, concerning an individual’s credit report.
- Medical debts are halted for 180 days before being listed on a person’s credit reports. This is helpful in the sense that the person is given time to review their payment options before their credit score is affected.
- Medical collections are evaluated as being lesser compared to other collections in a credit report. It is because of more recent scoring models i.e. VantageScore 4.0 and FICO 9. The only downside is that not a lot of creditors use these so there is still a risk of medical collections causing detriment to your credit score.
- Once paid for, whether by the individual or their insurance, medical debts are permanently removed from a person’s credit report, compared to most other collections that remain in the person’s credit report for seven years.
Medical bills during the pandemic
In states of emergency, rules relating to medical bills can be changed. It is easier for people these days, in the midst of a pandemic, to seek healthcare if they happen to catch the virus.
It is plausible to ask help from your provider if you are having difficulties making ends meet. Speaking up on time about your finances will get the medical providers to provide you with any type of assistance that can be offered.
You can also take a personal loan if you are struggling monetarily, they can be of help if and when a medical collector you are seeking help from refuses to do so.
Tackling medical bills
It is an individual’s right to dispute discrepancies in their credit reports. If they are approached by a collection agency, they are allowed to have proof of the debt in written form under the Federal Fair Debt Collection Practices Act.
Here are some ways you can deal with medical debt:
- Obtain information about the medical costs from your provider, in case you do not get a bill, you can contact or insurance.
- Ask for a written billing statement from your medical provider with all the details mentioned next to the charges as proof. Go through all the charges so you know there are not any inconsistencies, and that they are accurate to the medical help you received.
- Refer to an Explanation of Benefits (EOB) to find out how much your provider has billed you, how much your insurance covered, how much is left behind, and how much you owe. Try not to get billed any more than your insurance says that you are indebted to the provider.
- Ask to speak to your medical provider’s billing department and ask them how much you have to pay. Arrange for payment as soon as you can manage, even if they are not sure of how much you have to pay. They can still create payment schedules when paid in advance.
- Establish with your provider that you will pay monthly and have this written as proof. This can help you take a stand against them with written proof if they try to report inaccurate information to you.
Regardless of you maintaining a good credit score, medical debt still lowers your chances of receiving any kind of perks such as being able to acquire new loans. And with that being said, if you suspect that your credit report is being adversely affected by medical debt imposed on you, you can look up your three credit reports annually, free of charge. Note that you can do it on a weekly basis until April 2021.
You can also seek out your service provider or a debt specialist and request them to look into the issue and find a solution to it as soon as possible. Patient advocates can also guide you about your bills if they are too overwhelming for you.