In USA, medical debt is a major concern for many consumers struggling with debts, and fighting hard to repair their credit.
These debts are falling under the category of unwanted and unexpected financial burden, that are very difficult to pay off.
Plus, when these debts go unpaid for months, the medical institutions sell these debts off to collection agencies, which makes them even more problematic to tackle.
Once handed on to collections, they start getting reported on your credit report as delinquent debts, and begin to impact your credit score accordingly. Even though one can’t sole heartedly say that medical debts are consumer debts, yet they do behave like any other traditional consumer debts, up to some extent, after getting listed on credit reports.
This article is written to help you remove your medical debt accounts from your credit report, and to take the right precautions so as to prevent them from getting reported as delinquent on credit reports, in the first place.
After all, Oak View Law Group has always been the consumers’ one stop solution for all debt problems.
Hence, keeping that notion in mind, we are presenting to you this medical debt help article.
Go through this post in full detail, and we hope that you will be able to manage medical debts like never before.
**However, if you are in dire emergency, then contact us right now, and get your debt help without wasting any more time.**
When do medical debts get reported to the Credit bureaus, and how to avoid this reporting?
It is totally unethical to believe, that medical bills start to show up on your credit reports, from the very moment you pay a visit to the doctor, or enter a hospital.
Astonishingly, they don’t even get reported for the first six months or 180 days, from the date of incurring them.
They actually start to show up on your credit reports, if they are left unpaid for more than 6 months from their first date of occurence, and are sold off to collections by the medical institution, or the medical practitioner, or the clinic.
If you can by any chance, pay off the debt within the first 180 days, then you will be able to save yourself from the disastrous effect, that medical debts have on your credit score and credit profile.
Even though this post is limited in size and quantity, I will still be listing,
some ways to prevent your medical debt from getting reported to credit bureaus:
Get help from insurance companies to pay off the bills:
No one can help with medical bills more than an insurance company. Even though insurance companies are at times not so co-operative, but a little push from your side can make them pay for your expenses.Medical bills in our country are so huge, that even Bill Gates or Warren Buffet has to think twice before paying the bills from their own pocket!
You have to have a medical insurance.
Otherwise it will get very hard to pay off the medical bill at one go. But, try to make the insurance company pay the maximum amount, while you get to handle the minimum portion. A 60-40 situation is probably the most common phenomenon, where 60% of a medical bill is paid by the insurer, and 40% is out of pocket expense for the insured.
Also, to make sure that the insurance company is not getting too late to pay off the bills. Otherwise, you might be facing a situation where 180 days have passed, and the medical debt is sold off to collections, and starts to grow fat on interests charged by the collection agencies.
Discuss with the medical institution or doctors about a repayment plan and how not to report the debt to the bureaus:
As per the ongoing regulations, implemented by NCAP (National Consumer Assistance Plan), the Credit Bureaus won’t report a delinquent medical debt on a consumer’s credit report for 180 days from the date, the bill was first issued by a medical service provider.
Moreover, if a past delinquent medical debt is paid off by an insurance company, or a current medical debt is being paid off by an insurance company, then the credit bureaus won’t report the debt on a consumer’s credit report, independent of the credit reporting time limit.
Therefore, enter into a long discussion with your insurer and the medical institution, and then see how much the insurance company willing to pay and on what grounds.
Then, for your own out of pocket expense, try to devise a low/no interest payment plan, so that you can pay off the medical bill in full, within the 180 days time period.
If things don't work out for you, and you find the deductible amount to be too high, then you can let the insurance company make its own part of the expense, while you consult a medical debt lawyer later on, so as to decrease your consequences surrounding the debt account.
A good option can be using a no-interest period credit card, or a low interest personal loan:
This is a very unique and rare situation, but it is not historically impossible.
If you by any chance own a credit card that is having 0% interest period, then use it to pay off your medical debt.
No matter whatever we say, once a medical debt account goes off to collections, the agencies will definitely apply a certain amount of interest rate, even if it’s 2% or 3%.Hence, use a 0% interest rate credit card to your benefit, as you can totally scrap down the interest amount on your medical debt.
Again, taking out a personal loan to pay off medical debts can make sense, if you see that a personal loan is offering you a lower interest rate than what medical institutions or collection agencies are charging on the medical bills.
What to do when your medical debts show up on your credit report:
Considering the worst case situation, when the medical debts have been reported to the credit bureaus, and they are getting reflected on your credit report, then there are a few ways you can remove them.
But these are not sure-fire tactics.
You can remove the medical debt listing if it’s inaccurate:
This is the only feasible option to remove a debt account from a credit report. If the medical debt is inaccurate, and has passed both the Statute of Limitation and the Credit Reporting Time Limit, then you can easily remove it.
All you gotta do is send a dispute letter with all the information you have of the debt, to all the three credit reporting agencies, and then wait for their reply within 30 days of raising the dispute.
You can remove the debt, if you can make an insurer pay it off:
As stated above, when an insurance company pays off your medical debt, the credit bureaus automatically pulls it down from your credit report.
The reason might not be rock-solid, but is pretty logical. An insurance policy paying for your debt signifies that you have already paid for your medical debt in the shape of premiums, to the insurance company for months or years.
It is the insurance company’s fault that they got late in paying off the medical bills on your behalf.Therefore, it is not a default or delinquency on your part!
If you do not meet the above two criteria, then there’s probably no legal way you can remove medical debt from your credit report!Still, you can consult lawyers to see what options you might be having!
This post will now be counted as completed! Your queries and comments are very welcome. Your views will help us to grow better!
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