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Stopping Credit Damage Caused by Medical Bills

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If you want to make a statement about the increasing cost of medical services, and how the oppressive prices are affecting consumers, your best bet may be to go to Maryland. The state is currently offering for sale a series of shirts, which provide, in bold, plain language, the names of medical procedures and the costs.

Medical Costs May Vary

The shirts say things like “vaginal delivery,” with a price tag underneath ($11,590 for the privilege of birthing your child). The shirts are an attempt to raise awareness about the increasing costs of healthcare, but also to make customers aware of the range in hospitalization costs, and why numbers may vary.

One reason, for example, is the rate of mistakes a hospital makes. Mistakes cost money in follow-up procedures, monitoring, and longer stays. Thus, the average charge to a customer will be more in hospitals that make more errors.

New Credit Rules for Medical Expenses

Consumers who can’t pay exorbitant medical bills often find these overdue bills hitting their credit. In fact, it was estimated in 2014 that one in five consumers has a medical debt on their credit reports.

Unlike a consumer who uses a credit card to buy big screen TVs, those with medical expenses were often hit with medical needs or expenses they didn’t want, didn’t ask for, and couldn’t control. Whereas credit is supposed to be a measure of responsibility (itself, a dubious concept), many believe that the inability to pay an unexpected medical expense has no relation to someone’s level of responsibility.

There are some rules in place to help those with medical debt avoid credit problems. The major credit reporting agencies, Equifax, Experian, and Transunion, now must wait 180 days before putting negative information related to medical bills on your credit.

Any bills that end up being paid by insurance later on must be removed from your credit reports. This is in recognition of the time consuming and difficult process of getting health insurance to pay certain claims.

Fighting Medical Expenses

You should not assume that your medical bill is correct. One report demonstrated that a high number of medical bills contain some sort of error.

Fighting medical bills can be difficult, but it is possible. In some cases, any procedure or charge that is not reasonably related to what you needed done can be disputed.

Hospitals are also supposed to check with you before performing any procedure that is not considered “in network” on your insurance plan. If you are able to, make sure you do not consent to out-of-network care in any paperwork that you sign.

Many states also have laws against balance billing—billing you for any part of any procedure or medical service what your insurance doesn’t cover completely.

If any medical bill ends up on your credit that you disagree with, you can’t automatically have it removed for that reason, but you can dispute the negative credit mark by writing to the credit reporting agencies. The negative mark should show on your report that you have disputed it, and it may not have as much of an impact on your credit score.

If you are being harassed by medical bill collectors or have credit problems related to any type of debt, contact Jacobs Legal in Miami today to discuss how to fight back against debt collectors.

Resources:

commonwealthfund.org/publications/issue-briefs/2017/jun/balance-billing-health-care-providers-assessing-consumer?redirect_source=/publications/issue-briefs/2017/jun/balance-billing-consumer-protections-states

khn.org/morning-breakout/studies-find-high-rates-of-errors-in-medical-billing/

time.com/money/4943931/new-rule-medical-bills-credit-reports/

consumerfinance.gov/about-us/newsroom/cfpb-spotlights-concerns-with-medical-debt-collection-and-reporting/

arstechnica.com/science/2018/09/fed-up-by-crazy-hospital-bills-state-makes-passive-aggressive-t-shirts/

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