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6 Questions to Ask Yourself Before Paying a Medical Bill in Collections


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Does your blood pressure spike every time you tear open a medical bill? If so, you’re not the only one afraid to venture to the mailbox to read a letter about a medical debt you can’t afford to pay.

Nearly 3 in 10 Americans with health insurance had a medical debt that was sent to a collection agency, according to a Consumer Reports survey of adults who had a medical expense over $500. The same survey found that 24% didn’t even know they owed the bill, and 13% said they never received the medical bill.

If a hospital or other healthcare provider sent your medical bill to a collection agency, don’t pull out the credit card or checkbook just yet. Before you pay, ask yourself or the debt collector these 6 important questions.

1. Is the debt outside the statute of limitations?

Is the debt outside the statute of limitations?

If it’s been years since you didn’t pay on a medical bill that’s been sent to a collection agency, check the statute of limitations, which generally falls between three to six years on unpaid debt in your state before you make payment.

The debt may be “time-barred” if it’s older than the number of years in the statute of limitations, which varies by state. In many states, however, you can unwittingly bring that old debt back to life again if you make a payment or even acknowledge the debt in writing.

2. Can the collection agency verify the debt?

Can the collection agency verify the debt?

You have the legal right to ask the collection agency to verify the debt in question before you pay it. However, you have only 30 days after you receive the first letter about a debt from a collection agency to ask for verification of the debt, so don’t procrastinate.

You must request a “debt validation notice” in writing, and the notice must include the amount of the debt, name of the creditor owed, and a summary of your consumer rights under the Fair Debt Collection Practices Act.

Intimidated by writing letters? You don’t need to be. The Consumer Financial Protection Bureau (CFPB) has a sample debt verification letter on its website to help you out.

Find out: How to File a Complaint Against a Debt Collection Agency

3. Can I dispute the debt?

Can I dispute the debt?

If you believe that you don’t owe the debt in question, you’re legally allowed to dispute the debt within 30 days of the first communication with the debt collector about the debt, according to the CFPB. Make sure you dispute the debt in writing.

When you dispute the debt, the debt collector isn’t allowed to contact you to collect the disputed debt until it provides you with verification of the debt in writing. If you don’t dispute the debt within 30 days, the collector can assume the debt is valid.

4. How will the debt affect my credit?

How will the debt affect my credit?

Once a past-due payment or unpaid debt is on your credit report, the negative information – payment history is calculated as roughly 35% of your credit score – can take up to seven years to drop off.

Do your best to work out a payment plan or settlement with the debt collector and then stick to it to avoid lowering your credit score due to late payments and collection.

If the debt appears on your credit report, use those years to rebuild a solid payment history so that when the debt drops off, your credit score will improve.

Find out: How to Get the Credit Score You’ve Always Wanted

5. Can I stop medical debt from hurting my credit?

Can I stop medical debt from hurting my credit?

All three major credit reporting agencies – TransUnion, Experian, and Equifax – must wait 180 days after receiving information about unpaid medical bills before putting the debt on your credit report as past due. That gives you extra time to resolve the debt so it doesn’t appear on your credit report and lower your credit score.

Try to work out a payment plan, settlement or other arrangements with the collection agency within that six-month grace period so the debt won’t appear on your credit report later.

6. Can I work out a settlement or payment plan?

Can I work out a settlement or payment plan?

You may be able to settle the debt by offering collections a lump sum payment for a portion of the balance owed. For example, if the medical debt is $2,500, the collector might accept $2,000.

What if you offered to pay that debt off with $1,500 today? The collector wants to get rid of the debt too, so you may be surprised at the deal you can work out to settle the debt for good if you pay in a reduced lump sum.

If you can’t settle, the collection agency may be open to a payment plan. If you set up a payment arrangement, make sure the monthly payments are realistic. Then stick to the plan to eliminate the debt.

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