[Holding Pattern]

In April, I had some severe kidney issues...still not solved but now there is about $8,000 in hospital bills. They have told me outright that my $9-$12/hr job and my wife's meager social security for visual impairment/legally blind ($800/mo) is too much and we do not qualify for the indigent program or any financial assistance. We have made regular monthly payments - have not missed one month - and now the hospital has notified us that they will no longer send a statement/bill and we have two options:
1. they will guarantee a loan through a bank, and we can make payments. Of course, this turns a medical bill from a secondary creditor to a primary creditor and reflect differently on the credit report.
2. they will send us to collections.

I absolutely refuse to take out a loan for the medical bills.

If this does go to collections, am I just best to keep making monthly payments to collections as I have been? And if I do make on-time, regular payments can they still call me, etc?

I have very little recent experience with debt collections. Thought I would ask some advice.

 

[Pianolady]

Are the payments you've been sending an agreed amount between you and the hospital? If so, I can't see how they can send you to collections. Do you have anything in writing? Last time I had a big hospital bill due to a surgery, we had it all figured out and in writing before the surgery.

My other hospital bill situations happened over 20 years ago, and I was never sent to collections. I have a feeling the way hospital bills are handled now are quite different. I was able to take 18 months to pay off one of my c-sections back then.

Edit: I agree with Nishu below...the loan is better than going to collections. What's the rate on the loan? Could you get a loan with a better rate elsewhere? It wouldn't hurt to ask if you can create a repayment plan in writing instead of the loan route. Perhaps they hide this option in hopes you'll take the loan.

 

[Nishu]

I don't understand your reservations about getting a loan. It may 'reflect differently' on your credit report, but it can't be worse than have an 8k collections on it.

I think that if you take the loan, you'll have that loan, in good standing if you make payments, on your record for the next few years. As long as you don't have too many loans out, it won't actually hurt your credit. It could possibly improve your credit history. It will show on your report years later as a closed account in good standing, payments made on time.

On the other hand, you let that go into collections and it will remain as an open, unpaid account until you pay it. That's pretty bad. You won't get any credit for making payments to an open account that's not paid off. There's no mark on your credit report for "120 days late, but making payments." Assuming that you pay it off, the ticker will start counting down after it's paid in full and closed, and until the time is up (7 years I think?) it's going to show up as negative on your report. If you take 2 years to pay off that 8k, that means that you could have this negative mark on your credit report for the next 9 years.

To me, there's absolutely no contest.

 

[MaryCarney]

In reality, you already HAVE a loan - the hospital 'loaned' you the $$ / service, and you are making payments on it. So all you are actually doing is trading paper by taking out a traditional loan.

 

[frugalwarrior2]

I am surprised. Is this a payment plan you set up w/ the hosp.?
or are you just sending $$ you can afford. Our balance was way higher several years ago and we just send them payments-no loan signed.

 

[lisaflex]

the loan thing is more of a scare tactic in my mind. i used to do medical billing eons ago. but, if you set up a pymnt plan with the hospital billing supervisor and stick to it, they canNOT send you to collections or make you take out a loan! i wouldnt take out the loan....no way, no how. that is my opinion though.

are you sure you spoke w/ a social worker and the supervisor of billing to be sure you do not qualify for any sort of sliding fee scale? is it all one bill or are there seperate labs, etc? i there are seperte bills, i would pay the small ones first and just pay the bare minimum on the larger ones. then, once the small ones are gone, work on the larger invoices.

i am assuming you have no htlh insurance? am i right?

do you have some sort of medical assistance in your area? if so, call them immediately.

having never been in this situation, i am just giving you my own persoanl advice. i also sell health insurance now so i do have some knowledge. you will find some good advice here on FV. good luck.

are the calling you or sending you letters or both? i would defintiely write a letter explaining your situation and list all pymnts and dates paid (send the letter certified so that you have a signature date and time it was recvd) along w/ a pymnt plan that you can afford and take it from there. i would also call and speak w/ a social worker at the hospital. most hospitals also have a Patient Advocate - call them too.

Be as proactive as you can in order to have something to fall back on in case they do send you to collection.

 

[Nishu]

You're assuming that she made an agreement with the hospital to make payments on her bill. It doesn't look like that's the case. You can't just send payments on a bill and call that an agreement. If that were the case, we'd all be sending in 25 cent payments on any bill we have.

Hospital bills can be sent to collections, and you can get sued for them.

Also, if you didn't get it in writing, it didn't happen. Even if they said "yeah, go ahead and send 100 a month" or whatnot, you can't really count on that keeping you out of trouble.

 

[lisaflex]

You're assuming that she made an agreement with the hospital to make payments on her bill. It doesn't look like that's the case. You can't just send payments on a bill and call that an agreement. If that were the case, we'd all be sending in 25 cent payments on any bill we have.

Hospital bills can be sent to collections, and you can get sued for them.

Also, if you didn't get it in writing, it didn't happen. Even if they said "yeah, go ahead and send 100 a month" or whatnot, you can't really count on that keeping you out of trouble.

oh i understand that about the agrmnt. just wondering. and what about setting up an agrmnt now in writing? i believe that is an option. yes, i know the bills can be sent to collection, but not if there is an agrmnt in place that is being kept.

i still think they should contact a social worker and the billing supervisor and the patient advocate at the hopsital where the srvcs were performed. that is a good start in my opinion.

 

[AnW819]

I have over 20K+ in medical debt in collections on my credit report now. I had SO many at once, making a payment plan just would not of even worked for me being all this was in a 1 year span when I was in WV and jobless yet DH made "to much money" (give me a freaking break) to qualify for anything.

I was told by several people they can put medical on your credit but it CANNOT effect your score. There is like a "M" next to it or something....

I could be wrong though, but thats what I heard. How in the world I am going to pay of 20K+ in medical debt @ 22 is beyond me...but I will!!!

I also remember hearing that no matter what you give them, may it be $5 they cannot refuse it and say oh no, your payment was so and so...they have to take that money. (I have had a company do that before to me where I told them I only have $50 and they said well your payment is $100 and thats what we need, period. He would not take my $50!!!)

 

[HappyMama]

Dear Holding Pattern,

I am so sorry you are dealing with so much right now. I am sending blessings and prayers for good health your way.

Sorry this is so long hope it can be of a little information or help.

I always advocate personal responsibility on bills, and know you are trying to deal with this situation to the best of your financial ability. With that said :

Ignoring the problem will not make it go away! The first step to properly deal with hospital debt is the same as with any other debt; by acknowledging the bill Avoiding the situation or wishing it away will not solve the problem. In most cases ignoring the bill will be interpreted as an unwillingness to pay versus an inability to pay. Which I know you are trying to do, keep reminding them of the fact you are trying, but your income is limited.

Did you know that it is a common practice to charge uninsured patients full price for medical services? Insurance companies are able to negotiate with health care providers for lower prices leaving the people who can least afford to having a hard time so:


Ask for the itemized billing statement rather than just the summary. Double check the billing statement for errors like extra or double charges, or if there is a doctor's bill for procedures normally done by the nurses, for clerical errors and previously ordered tests that were cancelled but still appeared in the statement.

Negotiate for lower prices!! Contact the billing department and ask if they are willing to charge you the same price they charge their biggest insurance customer, Medicare or Medicaid. If the hospital is willing to negotiate be sure to get a copy of your agreement in writing to safeguard yourself in the event there is a “misunderstanding” in the future.

Try again to make a payment plan! Inquire about discounts or any payment plan that you can afford. Point out that though the amount you can pay may be small, at least you are going to do it regularly. You can arrange for the payments to be weekly, monthly, or even quarterly. You may even ask them if you could pay off the bill in a one discounted lump sum. In short, try to explore the options available for slicing the debt down.Even after negotiating lower prices, some families simply do not have the resources to pay a lump sum payment. You can contact the hospital and explain your financial situation. In most cases you will be able to set up a payment plan that allows you to repay your debt and avoid having your account turned over to a collection agency.

Apply for Medicaid. Medicaid was created to help consumers who live below the federal poverty level to pay off their medical debts. A successful Medicaid qualification can mean access to free consultations, free drugs, and other treatments. The best part about Medicaid is that it pays your bills retroactively, meaning that it would reimburse your medical expenses, even if your application was approved after you already paid.

Keep in mind If your yearly income does not exceed 200% of the Federal Poverty Level, there is a chance that 100% of your debt might be forgiven, but there is a catch: before they consider you for this benefit, you may have to prove to the hospital that you have exhausted the public medical benefits that are available.
The aid can cover a portion of the amount you owe if your medical bills exceed 30% of your income, even if you are above the Federal Poverty Level.




Finally in my opinion do not borrow money to pay your bill- If you are being hounded by bill collectors you may be tempted to borrow money to pay off your debt. Most times you can avoid paying interest if you set up a payment plan, however even if you are being charged interest it is likely less then that of a high interest credit card. Do not pay off your medical bills with a home-equity loan. Doing so will only turn your unsecured debt (which could be discharged if you were forced to file for bankruptcy) into secured debt. Defaulting on your home equity loan could result in losing your home which is far worse than dealing with even the most aggressive collection calls.

In answering your last question NO, being that your bill is with the hospital the original collector if you pay payments to the collection agency it will having you paying a "collection" bill of 8,000 which will stay on your credit report for 7 years and will not be listed as a positive rather a negative which will destroy your credit anyway. You need to make arrangements with the original creditor, so that you can pay, help the ones who gave you the service and maintain your credit while trying. Check out Bud Hibbs and medical collections for information that might help you.

I use to work in medical billing.

Best of Luck to you,

 

[Nishu]

Ohmigosh, folks. Read the original post. OP has already tried to work out something with the hospital and it hasn't worked out. There was no agreement to make payments. The hospital has, in black and white, listed the options. They're doing this person a favor by offering this loan.

I have over 20K+ in medical debt in collections on my credit report now. I had SO many at once, making a payment plan just would not of even worked for me being all this was in a 1 year span when I was in WV and jobless yet DH made "to much money" (give me a freaking break) to qualify for anything.

I was told by several people they can put medical on your credit but it CANNOT effect your score. There is like a "M" next to it or something....

I could be wrong though, but thats what I heard. How in the world I am going to pay of 20K+ in medical debt @ 22 is beyond me...but I will!!!

I also remember hearing that no matter what you give them, may it be $5 they cannot refuse it and say oh no, your payment was so and so...they have to take that money. (I have had a company do that before to me where I told them I only have $50 and they said well your payment is $100 and thats what we need, period. He would not take my $50!!!)

I really, really think you should check that out before you tell people this. I have a medical debt on my credit report and there is no distinguishing mark on it at all, nothing to say that's from a medical bill.

A spokesman for Fair, Isaac Co., creators of the leading FICO credit score, said the company would like to know whether certain collections are really predictive of future problems, but can't do the necessary research since credit bureaus don't distinguish among types of collections.

 

[AnW819]

Ohmigosh, folks. Read the original post. OP has already tried to work out something with the hospital and it hasn't worked out. There was no agreement to make payments. The hospital has, in black and white, listed the options. They're doing this person a favor by offering this loan.






I really, really think you should check that out before you tell people this. I have a medical debt on my credit report and there is no distinguishing mark on it at all, nothing to say that's from a medical bill.

Why so snappy???

I did say..."I heard", and "I could be wrong". Meaning, I am not sure.

 

[HappyMama]

Ohmigosh, folks. Read the original post. OP has already tried to work out something with the hospital and it hasn't worked out. There was no agreement to make payments. The hospital has, in black and white, listed the options. They're doing this person a favor by offering this loan.






.

Nishu,

I think it is wonderful and kind of you to take the time to be there for advice for Op.Thank you! Yes, I know he already asked for a payment plan, but in this economy, with that high of a bill, with the income level and extenuating circumstances ( his wifes disability etc) I encourage him to continue to ask etc.

The bolded part is my addition this is where we differ, I don't view the loan as a favor or kindness of their part.

Blessings hon and thanks for being there for the OP in his time of need.

 

[lisaflex]

The bolded part is my addition this is where we differ, I don't view the loan as a favor or kindness of their part.
Couldnt agree more. it is not a favor or along the lines of kindess (imo). no need to get snippy or nasty. the poor poster is just looking for some GOOD and NICE replies from fellow FV'ers...

 

[AnW819]

The bolded part is my addition this is where we differ, I don't view the loan as a favor or kindness of their part.
Couldnt agree more. it is not a favor or along the lines of kindess (imo). no need to get snippy or nasty. the poor poster is just looking for some GOOD and NICE replies from fellow FV'ers...

I agree...they are not doing it because they want to be nice to you and help you out...If that was the case, then they would help you out by making the payment plans a bit easier for us with lower incomes to be able to pay it. That would be something nice to do.

 

[Nishu]

I did not mean to imply that they're doing it out of the kindness of their hearts, but it is still a much better option than letting an unpaid, 8k medical bill fester on your record for close to a decade.

If OP has exhausted all options and has tried for every bit of help he can (as his original post suggests) then there are two options. Plain and simple.

OP, your comment about the loan suggests that you care about your credit score. If you care about your credit score, then there's absolutely, positively no contest. Letting this go into collections will trash your credit. Getting a loan won't.

I think you guys are letting your distaste for loans cloud your judgment. As someone else pointed out, OP is still borrowing money even if they don't get a loan. Difference is, if he doesn't get that loan he'll be borrowing from someone who didn't agree to loan him money in the first place.

 

[HappyMama]

At this point I still stand on my original advice in my prior post.

I have problems with taking a limited income, with extenuating circumstances, a high bill and an unsecured debt and possibly making it a secured one. I also think there is a better way and avenue to pay this bill, I would not take a loan until all the other avenues are pursed in my post.

Worrying about your credit will be an issue if you take a loan from an institution for an unsecured medical bill, and maybe not be able to pay it in . With all the circumstances in his post, it is more reason to simply pursue other avenues first.

I have no problems with loans when needed.Credit card debt, medical bills, personal loans, and many other debts that people commonly pay off with home equity loans are unsecured debts. This means that there is no collateral on these debts. If you fail to meet your payment obligations on these types of accounts, your creditors cannot simply foreclose on your home or repossess your car like they could on secured accounts.

ETA: I know there is other loan options available and OP or hospital might not want a home equity etc. but I still would look elsewhere. I won't go into all the other reasons that the loan is not in his best interests now as OP has enough advice to assimilate.

Blessings

 

[Nishu]

I have problems with taking a limited income, with extenuating circumstances, a high bill and an unsecured debt and possibly making it a secured one. I also think there is a better way and avenue to pay this bill, I would not take a loan until all the other avenues are pursed in my post.

This wouldn't be a secured debt. What collateral is he putting up?

 

[HappyMama]

This wouldn't be a secured debt. What collateral is he putting up?

I have seen more then my fair share with people taking unsecured bills and putting them into a secured loan is all I am saying . I did eta that I am not sure that would be the type loan they were offering but advise against it if so.
I still stick with my original advice and post , he will hopefully find a solution within the post

 

[lisaflex]

happy, i am with you. hopefully he will really read your post and find an answer.

some people just feel that there is no way out and i hope that the original poster does NOT feel this way. they justneed to reach out in the correct way and they should find some help in finding a responsible resolution to this.