Aside from the rising inflation rate, another thing making waves in the United States is the skyrocketing cases of medical debt. Medical debt is a growing problem in the U.S., with 79 million Americans having an issue with medical bills or debt. If you are among these individuals, and it seems like all hope is lost, I suggest that you negotiate a payment plan with your medical provider. Such a plan often requires you to make minimum payments until the debt is paid off. However, it is alleged that even while making payments, your bills could still be sent to collections. How true is this?
Your medical bills can be sent to collections even while making payments. This usually happens if you make small payments or if your payment comes in a few days late when you are under a payment agreement.
Medical debt is undoubtedly one of the largest debts in the United States, and this is because of the widespread need for medical services like treatment for an illness or injury, medical tests and consultation, and so on. If you are roped in medical debt, one thing you would want to prevent is having your medical bills sent to collections. Having your debt sent to collections can be bad for you and your credit score. Unfortunately, there is a possibility that even when making payments, your medical bills can still be sent to collections. Continue reading to find out more.
What Is the Minimum Monthly Payment on Medical Bills?
Can Medical Bills Be Sent to Collections if You Are Making Payments?
Medical debts can be a hassle, especially when you have a lot of them. However, thanks to debt consolidation and other forms of debt relief techniques, you can negotiate with your creditor, thereby easing the burdens of the debt.
Negotiation Is Key as Far as Medical Bills Are Concerned:
One of the best ways to negotiate with your medical provider is by creating a payment plan that requires you to make minimum payments on your debt. Don’t expect the hospital to inform you of this option as they expect you to pay your bills in time and completely.
Thus, it is up to you to be upfront while negotiating. Let them know of your financial problems. And also, let them know that you wouldn’t be able to make lump-sum payments. Don’t fret; the medical provider will consider your offer provided the drafted payment plan is good. However, if he or she doesn’t, it isn’t the end of the world. You could consider other options.
The Medical Provider Agreed to My Payment Plan; What Next?
If the medical provider agrees to your payment plan, you will have to ensure that you stick to it. Remember, not all hospitals will consider such an agreement, so don’t ruin the best chance you have to pay your debt on your terms.
In addition, while trying to pay off this debt, ensure you don’t rack up any other debt to make payment easy. That said, let’s highlight the main question of this article:
Your medical bills can be sent to collections even while making payments.
This usually happens when:
- You are making small payments.
- You make your payment a few days late when you are under a payment plan or agreement.
To ensure that your bills don’t go to collections, you must make a lump sum payment (if you are yet to negotiate with the medical provider). If you have negotiated a payment plan with the medical provider, the best way to ensure that it doesn’t get sent to collections is by sticking to the plan. If you agreed to make $300 every month on a specific day, stick by it because if you don’t you could wake up one day and discover that you have a hospital bill sent to collections.
What Happens When a Medical Bill Goes to Collections?
When your medical debt is sold to collections, the collection agency that bought the debt may report the account to one or more of the three credit bureaus (Experian, TransUnion, and Equifax).
Experian doesn’t indicate medical collections on a credit report until they are 180 days past due. This period offers individuals with medical debt six months to tackle any insurance or billing problems and make a payment plan if needed before the past-due balance is reported. If you discover that the medical bill indicated on your credit report is incorrect, you’ll have to contact the creditor to fix the issue.
Having understood what happens if a medical bill is sent to collections, the next step is to draft a plan. Now that your bills have been sent to collections, what do you do?
What Do You Do When a Hospital Bill Goes to Collections?
If you have a medical debt that you are unable to pay off, rather than ignore it, or try to run away from it, make an effort to contact the medical provider to discuss your options. Depending on how much you owe or your situation in general, some medical providers may be willing to set up a payment plan for you. However, if things don’t work out fine and your bills are eventually sent to collections.
Below are a few things you need to do:
- Reach out to the agency and work out a payment plan
- Understand the statute of limitations
- Check to ensure that your credit report is up to date
- Dispute wrong information
How Much Money Can You Keep at Home Legally?
How Do I Keep Medical Bills From Going to Collections?
Medical bills are easy to pay off. However, when they become overwhelming, you could find yourself struggling to pay what you owe. If you are in this situation, I’ll advise that you do all your best to ensure that your bills don’t go to collections. But, how do you do that? How do you keep your bills from being sold to collection agencies?
The best way to prevent your medical bills from going to collections is by paying what you owe in a lump sum (if you are yet to negotiate a payment plan). But, if you have negotiated a payment plan with the medical provider, you’ll have to stick to the plan to ensure that your bill isn’t sent to collections.
Having your bills sent to collections could be bad for your credit score. And when your credit score takes a hit, securing a loan in the future may be difficult.
