A recent study from the Consumer Financial Protection Bureau found that 52 percent of debt on credit reports is from medical expenses, with an average balance of $579. Medical debt impacts 43 million Americans, and 15 million of those only had medical debt in collections.
This is important because it points to a few important threats for consumers.
Health insurance is confusing, doctors’ billing practices can be questionable and collection agencies have been known for putting the debt on your credit report before making any effort to collect from you. This means it’s not uncommon for people to see a medical debt end up in collections without ever being alerted of the debt.
Here are some ways to prevent medical bills from going to collections:
- Make sure your doctor has your correct address. Take a moment to confirm the information your doctor’s office has on file is correct (i.e. – mailing address, phone number, email, etc.)
- Set reminders to follow-up. Do not trust that the doctor’s billing dept. will do their job or have your best interest at heart. Set up reminders on your phone and in your day planner as to when your bill is due.
- Understand your insurance. Know your deductible and how much your co-pays should be, so there are no surprises.
- Work out a payment plan. Sometimes medical debt goes to collections because the bill is just too much to pay. Instead of ignoring the debt, try to work out a payment plan with your doctor’s office or the hospital, before it goes to collections. Request an itemized copy of the bill and check for any errors. Find out if you qualify for any charitable assistance. This is oftentimes based on income and circumstance.
Those who have experienced illness or injury and found themselves overwhelmed with medical debt should contact an experienced Miami bankruptcy attorney. In bankruptcy, medical bills are considered general unsecured debts just like credit cards. This means that medical bills do not receive priority treatment and can easily be discharged in bankruptcy. Bankruptcy laws were created to help people resolve overwhelming debt and gain a fresh financial start. Bankruptcy attorney Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade & Garcia, P.A. has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade & Garcia website at www.miamibankruptcy.com.
Related Resources: http://money.usnews.com/money/blogs/my-money/articles/2016-03-29/beware-the-biggest-threat-to-your-credit-score