With the advent of credit cards the consumer has been able to buy things they want and need but may not have ready cash available for. Credit cards allow us to make monthly payments dictated by the creditor and we remain in good standing as long as we adhere to their terms of service. The availability of health insurance for those who have it and can afford it gives us the opportunity to seek medical attention when needed, with the insurer assuming a good portion of the medical bill and leaving the patient with a set copay.
We are protected by rules and regulations established by the FTC and the Fair Credit Act and can avoid collection procedures, default judgments and negative credit reporting as long as we make timely monthly payments on our debts. There are times when the consumer may need to negotiate payment arrangements lower than the set standard with the creditor to avoid the consequences of default. In the medical field, most doctors’ offices request copayment at the time of the office visit, while hospitals send bills to the patient for the balances after the insurer has remitted its share. The only difference is for Medicare patients, who are billed the office visit copay after Medicare remits payment or those without insurance who must pay in full or make payment arrangements. FTC regulations provide people with mounting medical bills with the same protections against collection procedures as long as payment arrangements are made and adhered to between the biller and patient.
However, I recently found that making payment arrangements with medical facilities and faithfully remitting the agreed upon amounts does not protect you from possible collection procedures. There are times when medical conditions require more doctor and hospital visits. The bills for the patient’s copay can start to pile up creating a “running tab” which can be quite high by the time the patient is billed. For those who cannot afford to pay a medical bill in full, especially the elderly and disabled on fixed income, payment arrangements are normally a wise choice.
I don’t know how medical billing is done elsewhere, but in Hanover a majority of doctors including those on hospital staff have billing done by one billing company instead of by office staff. When I was flown to Penn State Hershey Medical Center for stent placement earlier this year, the helicopter ride itself was over $60,000 but was thankfully put under their charity program. A subsequent trip to Hershey Medical for complications was made by ambulance, most of which was covered by Medicare. I made payment arrangements with the billing company, AD Electronic Billing, for the ambulance service balance. Although I made payments every month for 3 months on the same date of each month, I received a debt collection letter in August. In my call to AD Electronic Billilng asking why they sent me to collections, I was informed that even though they received my payments, they were “inconsistent” and they had no record of my original call making payment arrangements. I paid the balance to the collection agency by credit card and incurred interest charges.
Although I had made payment arrangements with my doctors’ billing company, Hanover Health Corp, and made those payments on time every month, I decided to call them to verify the arrangement after my dealings with AD Electronic Billing. By this time, my “running tab” with Hanover Health was hundreds of dollars. The billing clerk verified that I was indeed on a payment plan, but they were getting ready to send the oldest unpaid claims to collections. When I asked how they could send someone’s account to collection while on a payment plan, I received no answer. Even though I had already mailed my August payment, I paid an additional amount by credit card during that call. I requested written confirmation that I was on a payment plan with them, but never received it. After diligently going over their last bill to me, I charged another couple hundred dollars in claims to my credit card a few days later.
I worked in credit granting and collections for over 22 years before retiring on disability. I always worked with my clients when they experienced cash flow problems and only sent an account to collection if no payment was made after 90 days. While I realize that everyone is feeling the crunch in this economic downturn, I feel it’s dishonest, if not illegal, to turn an account over to collections while a payment plan is in existence. You have to ask why anyone would continue to make payments if they are eventually going to be sent to collection anyway. Most consumer protection laws pertain to credit cards and loans. I could find very little on protection regarding medical billing procedures. So, I wrote a letter to AD Electronic Billing and another one to the ambulance service that uses them. I also filed a complaint with the FTC, though it may take some time to get a response. Just beware that you should get payment arrangements in writing, and when talking to a billing representative, be sure to ask if the company sends accounts to collections even with a payment plan in place.