Sent to Collection for inflated Medical Bill

Discussion in 'Credit Talk' started by houstsk, Jun 4, 2011.

  1. houstsk

    houstsk New Member

    My daughter underwent eye surgery in Dec 2010. The clinic was to call us in advanced and quote th amount. They did not do that. When we went in on that day, they estimated to cost $1100 which is just for the facility fee which took less than an hour for total procedure. Doctor and Anesthesiologist charge separately. We agreed to the amount and paid 50% ($550) on the date of service. However, they decided to increase the bill to $1650.00 post surgery because $1650 is the maximum amount that our insurance would allow them to charge for this type of procedure. However, due to deductable amount, the clinic sent us the bill for $1100 (addition to $550 that we paid). I believe we should not be paying more than what previously agreed $1100. I let them (both clinic and collection agency) know that I dispute the billing amount and offered to pay $550 remaining 50% amount of previously agreed. they disagreed and sent the bill for collection. I need some options.

    I am not sure what I can do to stop collection agency from posting negative to credit reporting agencies. Should I hire lawyer? They are doing this in next 3-4 weeks.

    Would it be easier to fight after negative report has filed with reporting agencies? May be credit reporting agencies would be easier to convince that this negative is posted unfairly?

    Worst scenario would be negative got posted and we do not pay the bill. How long would it stay on our credit report for unpaid medical bill? Can they sue us to collect?

    I am in Texas
  2. JMason

    JMason Well-Known Member

    What does your insurance provider say about this?
  3. Stand_Tall

    Stand_Tall Well-Known Member

    I'm with JMason on this one. I think it would be prudent for you to contact your Insurance Provider at the earliest possible opportunity, explain what's going on to them and proceed from there. If anything, you're creating a "paper trail" that shows you did everything in your power to resolve this issue should you end up going to court.

    After discussing this with your Provider, and assuming it hasn't been 30 days since the Collections Agency first contacted you via dunning letter, I would send them a Debt Validation letter. It's not an aegis against further collections activity, but no collection activity (or reporting to the CRAs, save for noting that the account is "disputed") can take place while validation is pending. Keep the letter simple, but also specifically state that you dispute that the amount they billed you for is the correct amount.

    Best of luck.
  4. JoshuaHeckathorn

    JoshuaHeckathorn Administrator

    Be warned- I'm going to rant a little bit here. I've had this same thing happen to me with medical providers. It's infuriating! I must admit that in the end I've just paid what was billed after fighting with the insurance company and medical provider for hours on end and getting nowhere.

    In some cases I've been able to get the medical provider to reduce the bill, so I would recommend still trying to fight your way up the chain with the medical provider. Someone in their billing department always has the ability to reduce your balance. It's just difficult to get to that person sometimes, especially if the debt has already been turned over to a CA.

    Our healthcare system in the US is so screwed up. If you have a high deductible plan and basically pay first dollar for these types of services, you CARE about the cost. Medical providers still don't get that. In fact, most of the time they have trouble even giving you an estimate for what a procedure will cost. Even if they can, it's rarely close to the end cost. Ridiculous.

    Trust me, it won't be easier to fight once it ends up on your credit reports. Then you'll just have crappy credit, the CRAs won't listen to anything you say, and the negative mark will remain for the next 7 years. Try your best to work it out before allowing that to happen. Of course, you'll want to lean on the insurance company too as was already suggested. Good luck!
  5. houstsk

    houstsk New Member

    Ok. I am going to contact insurance again and see what they say. On first contact, they says the billable amount is what they negotiated with the provider for procedure like the one I had and if they previously quoted lower amount. I should be negotiated down to that quoted amount.

    I can afford to pay this bill. It is a matter of not giving in to those people who are allowed to rob others. I am determined not to pay that bill at all. My credit score is over 800 last time I checked. I have my morgage paid up. I don't need any new credit but I want to maintain credit lines that is already provided to me since I run a small business and I need credit for day to day operation. I want to know if credit card company would reduce my credit line if this adverse report is filed with CRA? I don't worry about rates shooting up since I don't carry balance over. I paid balance in full every month. I do worry about credit line.

    What is debt validation letter? Is it just asking them what is the amount I was billed for? Who bill etc as if I don't know?
  6. JoshuaHeckathorn

    JoshuaHeckathorn Administrator

    Yes, your FICO scores will take a big hit and your credit card companies could reduce your credit limits as a result. You will likely find it difficult to renew credit lines for your business as well, since personal credit plays a large role in that process these days.

    Oh, and DV letters are sent to protect your rights under the FDCPA and force the CA to prove that they have the right to collect the debt.
  7. houstsk

    houstsk New Member

    How big the hit it would be to my FICO score for unpaid balance of $1100? Called the insurance and they said I just have to talked to provider for the difference between quoted amount and repriced amount from insurance.
  8. JoshuaHeckathorn

    JoshuaHeckathorn Administrator

    It depends on a lot of other factors in your credit history, but if you have a good credit score in the upper 700s I think it's safe to say you can expect to see a drop of over 100 points for a collection of any amount.
  9. houstsk

    houstsk New Member

    Just updating...

    Instead of paying them, I decided to send them DV letter about a month ago. Explained that I agreed to pay half the amount but not whole amount and requested to provide detail billing from their client that it says I owe what they say I owe. Three weeks passed and I sent them second letter reminding them the DV request. This week I got a letter back saying they are requesting the deletion of the account from Credit Bureaus "due to extenuating circumstances". They stated that the account is owned by their client despite the fact they are requesting the deletion of the account from Credit Bureaus, which implies that their client might pursue other means to collect.

    What are the chances I would get letter from another collection agency. I would have paid them half of the collecting amount since day 1. They don't seem to understand what my accountant professor used to say... "Money has the time value". Or they have a good success rate of pushing people like me.
  10. JoshuaHeckathorn

    JoshuaHeckathorn Administrator

    CAs often don't act rationally, and I wouldn't count on this going away. There's a good chance it could end up in the hands of another collection agency.

Share This Page