Here’s another tip about a specific debt situation that often affects those who have a false sense of security from owing just a little bit of money to a medical office or other business:
Pay attention to the less significant debt letters and small bill statements you receive. The major problem with ignoring these is that even the smallest debts, debts that may total only a couple of hundred dollars, can balloon into massive amounts of money when you don’t understand the collections process, the accrual of interest, or other factors.
So, how does your small dollar medical bill become a giant drag on your finances? It usually happens when the borrower simply decides not to pay anything and lets the bill lapse into collections. When third party collectors receive this account, they may be able to add certain types of charges. This may include additional fees for filing the debt in a legal office, as well as other fees related to documentation of the existing debt. Any costs that involve trying to shoe-horn the borrower into a local court can also show up on that person’s credit. Then there is the issue of ‘communications costs’ related to overdue bill notices, phone calls and more. While there are federal collection laws, each state also follows its own set of laws.
Avoiding critical communications with the original creditor, the doctor’s office, can get you into a lot of financial trouble. Remember this when small dollar claims for co-pays, deductibles and other expenses come in the mail, and you could be helping yourself out of many hundreds of dollars of additional debt. When it comes to handling various types of debt, and medical bills in particular, staying out of the loop and waiting until the last minute is almost always a poor choice.
(Update yourself on Senate Bill 2149 – Medical Debt Responsibility Act 2012: A bill currently in review to exclude medical debt from consumer reports that has been in collection and has been fully paid or settled.)
All user-generated information on this site is the opinion of its author only and is not a substitute for medical advice or treatment for any medical conditions. Members and guests are responsible for their own posts and the potential consequences of those posts detailed in our Terms of Service.
Add a Comment3 Comments
Health Care has been a part of our life so it is better that we remain healthy and try to avoid unwanted medical bills. In these few days there are many people who try to avoid the medical bills but they don't understand the actual fact that this can ruin their entire life and they have to pay more than they paid for the medical facilities. They should first search of a good urgent care center and they should go a proper treatment and clear their unpaid bills.
August 18, 2013 - 12:02amThis Comment
Thank you for comment and my pleasure.
August 20, 2012 - 5:34amThis Comment
Hi sunnip,
Thanks for sharing this information.
Best,
Daisy
August 13, 2012 - 6:47amThis Comment