Medical Bills Sent to Collection Agency Making Threats – Settle Debt or Pay What I can Afford?
A few years back, I had a hernia surgery. My parents paid for part of the procedure, and the hospital was able to cover the cost of the operating room with their indigent fund. However, a previous E.R. visit generated a bill for a little over $600.
I have been getting a lot of these calls regarding it, with a recording "Is this" (different voice) "John C.." (different voice) "If so, press one". I had gotten some previously, and stayed on the line long enough to explain that I had been working on creative projects and doing odd jobs, and I had no significant assets. Then, the debt got passed to a Franklin Collection Agency. The guy sounded friendly enough, but he says that if I just start paying what I'd prefer to, the debt will go to their legal department, and I'd have to pay an additional $200 in court costs.
Allowing the case to go forward isn't completely out of the question, since a wage garnishment would affect me only when things were going well enough to have a wage (they are also helping me get some dental work done); but I'd prefer to pay e.g. $50/month. They say that if I don't give them an account with automatic withdrawal, and agree to give them ~$164, or pay ~$219 with a non-automatic withdrawal account, that it will not prevent them from sending me a summons, and, the fellow said, "Frankly, I don't know why you haven't gotten one already."
I may be able to scrape one of these amounts together, but I'd really like some advice on if the guy with Franklin is telling it straight, and what are the pros and cons of either 1) paying it like they want, 2) just paying, say $50/month anyway, or 3) not paying it. It seemed like a last-minute ambush for money TODAY, but maybe or maybe not how they are proceeding is normal, and I should just cough up badly needed money. He says "the bank" is unwilling to accept a settlement.
Should I go to court, can I get a public defender, and are my odds good at getting a 60% settlement?
What do I do about medical debt and the collection agency saying summons is overdue?
—John C.
Short answer
Take a collector’s talk of a lawsuit being long overdue with a grain of salt. Medical debt tends to settle at higher percentages than credit card debt, so if you are already preparing to settle at around 60 percent, save the money as fast as you can and settle, rather than sending payments.
Key points on this page
- Debt collectors are trained to press your emotional and stress buttons to get paid, and a reference to being sued is an effective one. It does not mean a lawsuit is coming.
- Negotiating a lower payoff on medical debt is often done at higher rates than on credit cards, which means you save less.
- The lower the medical debt, the more the general rules about which accounts belong in a settlement plan apply.
- Small payments you send without an agreement in place do not necessarily prevent a summons.
- Around 60 percent looks like a realistic settlement on this kind of medical bill. Get the money together first, then negotiate.
When a debt collector tells you that your being sued is long overdue, take it with a grain of salt. It is not that they cannot or will not sue. I would need a whole lot more information in order to offer feedback about the risk of that happening to you. But collectors are trained to press your emotional and stress buttons in order to get paid. Making reference to being sued is rather effective.
Settling medical debt is often different than negotiation credit card bills that went unpaid.
You mentioned he said “the bank” and used quotes. The debt collector you spoke with probably also collects on bank debts, not just medical bills. I would not read too much into that other than, here is an example of a guy following his script and routine in order to get some form of payment – which accents my point about his reference to a summons being over due.
Negotiating a lower payoff and settling medical debt is often done at higher rates. In other words, you do not save as much. The lower the medical debt, the more the principles I laid out in this article apply: https://consumerrecoverynetwork.com/credit-card-debt-to-include-in-settlement-plan
If you are unable to make payments as high as the debt collector is requesting; if sending smaller payments (that are not agreed to in advance) does not prevent a summons; if you already are preparing yourself mentally and financially to settle at 60% – Save up the money as fast as you are able and settle the medical bill rather than make payments.
I think you can settle this for close to 60%. When you are ready with the money, come back and review the debt settlement section of our fee online debt relief system. Post questions on this page and get feedback.
Any questions or concerns you have after reading my feedback can be posted in the comments below. All readers concerned about dealing with medical debt in collections can post below and receive feedback.
About Michael BoveeMichael started CRN in 2004 with a mission to provide people in need with detailed debt and credit help and education. Michael has participated as an expert panelist in federal consumer protection rule making, collaborated on state law changes governing debt consolidation, has worked as an expert witness in court matters related to the debt relief industry. He is available to speak with you about your financial struggle and helps people resolve their debt problems daily.
I had my appendix removed in May 2014. When I went into the ER, I updated my address and phone number. I received all of my hospital bills, and have paid them in full. However, I did not receive the anesthesiologist bill. I didn’t even realize it was a separate bill until I was served court papers at the school where I am a teacher. The anesthesiology company was sending them to an address that we hadn’t lived at for 2 1/2 years. Once they found the correct address from the insurance company, they turned it over to collections. They never sent anything that I received, so the first notice was the summons. Now this lawyer wants me to pay over $500. The bill was only $166.80. I have offered to pay this in full to all parties, but no one will take the payment. The lawyer demands the $500+ to take care of this. What do I do???? I never got a bill!
The opening date of the collection agency account is the date they got the account for collections. It does not re-age the statute of limitations for lawsuits or reporting. The date you had the procedure determines that. If it was December 2009 then they can no longer sue you under FL law that limits contract suits to 5 years.
They can report until next year. You can attempt to get it removed however, legally they can report the debt until December 2016.
I am glad to know that the date of the collection opening does not reage the debt. So if the statue is up December 2016, and it is not removed, what would be the best course of action to take?
Medical Bill on Credit Report, SOL with two states involved.
I reside in Oklahoma and always have. I was visiting Florida in 2009 and had an in office medical procedure done. I gave insurance information day before and had her preauthorize it ( yes I know I should have called myself and ensured that it was done correctly). I had the procedure the next day, paid a co pay and left. I Never heard anything about a balance for over a year. Then one day the receptionist began calling stating I owed over $8,548.00. I obviously did not have this amount of money to pay so it became delinquent.
This is now on my credit report with a opened date of December 18, 2013 and the agency is CAPITAL ACCT. I am not sure how to go about getting this removed from my credit report. I have never received any letters or phone calls from this creditor before. I am just wondering if the initial date would be 2009 or the opened date of December 2013. How do I know when it has been the seven years or has met the statute of limitations, so I can start trying to get it removed?
Thanks so much for your help!
1) Let this one drop on its own. You can even dispute it as obsolete now. There is a chance this collection agency no longer has a business relationship with the provider and cannot validate and that gets it removed.
2) IC Systems is a bottom feeder and you should NEVER pay them a cent. Contact the providers who gave you the care and offer a pay for delete directly to them. If they will not deal with you directly THEN offer a PFD to the collection agencies.
3) Contact the hospital and offer to set up payment arrangements. If you used insurance on these bills they cannot discount them any further as that is illegal rebating. Otherwise knocking off the smallest ones one at a time might be faster.
In the future it is always much easier to set up payment arrangements and make small monthly payments (which most providers will do) than to simply ignore it and let the bills go to collections.
I’m trying to build my credit score up and currently have 11 medical bills in collections. They range from 2008 to 2013. I have several questions.
1) One debt of $109 is scheduled to drop off my report in 09/2015, should I bother calling Amerifinacial Solutions to offer payment of $70?
2) Two others are $136 w/ I C Systems and $250 w/ REC MGM Systems and not scheduled to drop off until 2017, should I call or send them a letter offering $80 and $150 respective?
3) The remainder are with Equidata and for 8 different bills all from the same hospital , $1,713, $572, $128, $111, $172, $222, $239, $302. My question is that 60% of the total of all the bills is too costly for me to pay in one lump sum, so should call or write offer settlements on each bill separately?
Besides, theses bills I have $18,000 in student loans and $1,400 on a department store credit card. I currently bring in $1,200/monthly and have 2 children.
Could you recommend a god attorney in Tulsa, Okla.
I sent you an email with contact details to two consumer law attorneys in Tulsa. The area of consumer law each specializes in are similar, which is most anything to do with debt collection.
If you have other needs than that, post a more specific outline of your situation.
I would start by going to http://www.consumeradvocates.org and speaking to a consumer attorney. Depending on how that threat about the legal fess was worded it may be a violation of the FDCPA.
How long ago was this debt? See if the hospital has charity care and find out why they didn’t automatically sign you up for Medicaid. If all that fails BK may be the best option.
Hi,
While in school I was taken to the hospital due to complications with diabetes. I did not have insurance, except for insurance through the school which I was told covered emergency visits. I was admitted through the ER and stayed about a week. When the bill came, the school insurance stated they could not cover the costs because they were a supplemental plan only. Now I am stuck with a bill for more than 16,000. I just recently graduated and found a job, but that’s more than a third of my yearly salary. Is there anything I can do outside of filing bankruptcy. I just recently started paying the cheaper of the two bills with $20 a month payments, its total is about 1,300. The plan was to pay that one and then tackle the larger one. But i received a letter from a layer stating that if I did not pay the 16,000 plus bill in full I would also be responsible for legal fees. I have no idea what to do. What can I do?!
Hi Michael
I have a $170 medical bill that I missed and then 3 month later transferred to a collection agency that they reported it as unpaid to my credit report under derogatory. I want to pay it but I need to remove “unpaid” note from my credit report. What kind of documents I need from the collection agency when I pay the amount , what should I ask them to do when I pay the amount to remove this note from credit report?
I appreciate your response
Regards
Sal
You may not get it removed. What you should do is contact the provider of the care FIRST. Many times if you take a “gee I am so sorry I missed this let me pay it now” attitude they will not only take the payment (NEVER pay a collection agency if you can avoid it) but will get it deleted. Another option is that you dispute it as paid to the provider and therefore the CA has nothing to report. If they have a contract with the CA that once it is there you must deal with them then negotiate a PAY FOR DELETION. Some CAs have a policy against doing this in which case you have a paid collection which is better than unpaid. Make sure your settlement is in WRITING. ANY promise they make over the phone is not enforceable.
” I have received a lawyer letter today stating I have 30 days to respond to letter or will be sent a judgment.”
You might want to consult a consumer lawyer. The statement that if you don’t pay they will send you a judgment is false and likely a violation of the FDCPA. In order to get a judgment they would first have to sue you. If you lost the case THEN they would get a judgment. However, they cannot just send you a judgment if you refuse to pay. Go to http://www.naca.net to find a consumer lawyer in your state. Most if not all do the first consultation for free.
“Can I go to court without paying and be placed in jail?
NO. The USA has never had debtor’s prisons. The worst it will do is mess up your credit and they can in most states garnish wages.
“Are they trying to scare me?”
YES. First call the hospital patient representative and explain your situation and ask about applying for charity care for being uninsured and low income. It may get the entire bill written off if not a substantial discount. If you have already been given a low income discount then I would arrange payments with the hospital NOT the lawyer.
I have a medical bill from last year that totaled $2286 for a removal of a Kidney Stone. I did not have insurance and have not been able to pay the debt at all. I am really scraping by and now I have received a lawyer letter today stating I have 30 days to respond to letter or will be sent a judgment.
It states to send the full amount to the office and if it is impossible to send the full amount, to contact them and mutually agree upon payment terms. It goes on stating this matter is becoming increasingly serious. Can I go to court without paying and be placed in jail?
Are they trying to scare me?
I have health insurance now and figured I can just not pay this as it went from an ER visit to having the procedure done that day.
please help…
I have a medical debt of $641 from last November which was referred to a collection attorney recently. I have been unable to work since January 3rd due to medical complications of pregnancy. I lost my job on July 31st due to exhaustion of FMLA. I have not yet been cleared to work, so my income is zero. I got a summons to court, called the attorney, and he offered me a stipulation. I said I could pay $400 now and $100 each month afterwards. He emails me the stipulation and it says I owe the original $641, $52 in interest, $250 in “costs” and $900 in attorney fees!!!! This is over $1800, 3 times what I owed. Right now, we are barely living paycheck to paycheck off my husband’s job, and we CANNOT afford to pay that! Can I call the original party to pay them the $641 plus $52 interest in full, or am I stuck bargaining with the attorney? I could only pay the $400 by borrowing money from my parents. I think it is exorbitant to charge $900 in attorney fees, and what are the “costs”? How do I go about negotiating this down?
Show up in court and challenge the fees, and what is reasonable with the judge.
900 dollars for the collection attorney paralegal to fill in some paperwork, all in under an hour… show up at court on a day they were probably already gonna be there… does not add up to me either. It may to the judge, but then again it may not.
Some courts do hold fair and reasonable costs and fees to a low bar with consumer debt collection cases.
Thank you for your reply. Prior to your reply, I called and they agreed to drop the attorney fees to $450. But I don’t feel that is reasonable either. And what does the $250 in “costs” cover? It all seems like they are trying to get as much extra as they can out of me.
That will be an amount the judge is likelier to agree with.
Costs can include local court filing fees (can be a couple hundred some places), process server, and other smaller contributing factors. If you look up other similar collection cases in that courts records, you will likely find costs listed in initial filings of around the same amount.
My husband is being sued for medical bills in indiana. We have been legally separated for 20 years. He has court tomorrow and the collection agency lawyer told me I have to be at court to provide my income. Can they do that? I’m not on the court papers for the suit and I have not been summons to court. Please help.
I doubt it, but run your question by an experienced debt defense attorney near you to be sure this is nothing for you to worry about. If you post the name of a larger city near you, I can help you locate one, and who likely offers a no cost initial consult.
Thank you. Evansville, Indiana.
The four attorneys in Indiana I sent you via email a moment ago, all have the experience needed. None are all that close to Evansville, but distance is not likely going to be an issue for this.
Thank you
I have a medical bill from a year and a half ago for $4200 for my knee surgery and unfortunately ignored it because i was already paying off another medical bill from an out of town trip accident. I just received a letter from the collection agency stating that if they don”t receive a full payment in 20 days then they will take this to the courts and issue a summons. I am not in a position to pay $4200 in one lump sum, what are my options?
” If I settle with the collections agency does this make me eligible to dispute this account?”
Legally? No. The best way to get this removed is ask them to do a pay for delete. That means you agree in writing that once you pay the bill they agree to delete the trade line. You cannot force them to agree to do that and some creditors have a hard line policy against doing so. If you do not negotiate the deletion prior to payment it could appear on your report as simply a paid collection.
Disputing is based upon errors and so far there is no factual basis for a dispute. Before doing anything else though I would ask the lender point blank that if you get this taken care of will the loan be approved. The last thing you want to do is pay it off to find out there was more than this issue causing the denial.
I purchased a home before I met my husband. The home is in my name only. My husband had an accident this year and did not have any insurance. The bill is over $23,ooo. He has been making a payment on the bill monthly, but this past month they turned the bill into collections. Will this effect my credit score? and can they try to take my home from me? I was told by a friend that I I posted it publicly in news paper that I’m not responsible for my husbands bill. That may help me.
You will want to talk about your homes protection, from your husbands creditors,with an experienced debt defense attorney. I can help you find one if I knew the name of a larger city near you.
I am not aware of any benefit you would receive from publishing a public statement about you not being responsible for your husbands debt.
Back in 09 I went to the ER without insurance and my medical bill was $1611 and went to the collections agency in 2011. I’m currently just out of college and looking to refinance my loan through a different vendor for lower interest rates and payments but was declined because of this bill that is currently in the collections agency. If I settle with the collections agency does this make me eligible to dispute this account? If so, can you give me advice on the negotiation process for this amount.
Thanks,
Ben
Lets start at the beginning. Before you assume this is a valid collection attempt get on the website for your local court and do a search for your full name. See if a lawsuit has been filed against you. If your small claims court docket is not on line you can either call the court clerk or go to the court house. Sometimes the docket number is mistakenly omitted and sometimes it is an attempt to scare you into paying. If no case has been filed this changes the game. You do need to answer the suit and you do need to show up. If you were properly served and you don’t go to the court hearings they will get a default judgment.
The other phone calls are likely unrelated to the suit and a scam. It is a coincidence that they came at the same time. It is possible the scammers phished your name from the court dockets and are looking to cash in. Deal ONLY with the court and the attorney’s office directly. They will not call you from “RESTRICTED” or “UNKNOWN” numbers.
The phone calls from the collection agency MIGHT be a violation of the TCPA but you would need to discuss this with a consumer attorney to be certain. They are not a violation of the FCDPA. IF you have more questions post back.
I received a summons for a Medical Debt. The plaintiff is a collections agency. The debt to the hospital was incurred in April of 2013. There is a $200 and a $600, with $92 interest amount that are included. First, the summons states that all attorney’s fees and docket fees are included, but there is just the total plus interest listed. When calling to find out if there was any way to set up a plan and see if they would drop the suit, they refused and said that the current amount is $1399 and $200-$300 more would be added. Also there is no case number on the paperwork. Is this normal?
I do need to file an answer, and am considering filing against them for the collection practices. There have been a few instances of 4 calls within 1-2 min to my work number, followed immediately by 3-4 calls to my cell number. Though caller id just shows ‘restricted’. And messages about ‘we are going to come to your work and home, and you don’t want that’ But mainly, when I called asking about the summons, the agent told me that ‘most people are worried about having to take off work and show up at court, but don’t worry about it, you don’t have to go’. Is this just unethical? Or actually illegal to discourage me from showing up?
I just recently found out my credit card balance was sold to Cach. We have fallen behind on payments due to my husbands lack of work. His industry has been very slow and he has been out of work at least 6 months in the past year and a half. Our debt collectively is around 70k. I am assuming I will be served shortly by Cach and am wondering if I would be a candidate for bankruptcy. Do you know any bankruptcy lawyers in the Ronkonkoma NY area? I am wondering if that is the avenue I should choose before I am served. The min payments are just out of reach for us now and I have no idea which way to turn.
You can call 877-278-8117 and reach a bankruptcy professional in your area. With 70k in debts, and no stable income, chapter 7 bankruptcy will help you discharge those debts, and get a fresh start.
In Colorado judgments are good for 6 years from the date it is entered by the court and renewable in 6 year increments after that. The courts do not report judgments to the credit bureaus. The bureaus have web crawling search programs that comb the public records for judgments, liens, and tax records. However, if you move and remove the address associated with the judgment the search programs cannot connect it to you specifically.
It is not uncommon in medical debt for the CA that the provider hires to report the debt but not the provider themselves. This is because it is very expensive to belong to the bureaus to report. Collection agencies belong in order to increase their leverage in collecting.
You will not reset any clock by contacting them to settle this account.
That is very good to know. I am going to sort out how much I can afford and hope I can get this taken care of. Thank you for the information.