Medical bill got returned by USPS and sent to collections: how to fix?

January 2, 2013 1:48 PM

I recently found out a medical bill got returned by the post office and went to collections. How do I fix this?

I live in the USA and had an ER visit in September that resulted in the usual confusing array of bills. I had and continue to have health insurance through work, but provided it after the fact to the service providers who billed me. I had since been in contact with the billing department of the hospital and was told that everything was currently being processed by my insurance, but over the holidays my parents, who live in a different state, got a call from a collections agency. The call went to voice mail, but on googling the number it seemed like it came from an agency that mainly processed medical debt.

After calling several numbers affiliated with the hospital, I at last talked directly with the emergency medicine department and found that there was in fact a separate charge I hadn't been aware of, which was sent to collections because the bill was returned by the post office. The address I gave didn't have my apartment number, so that's probably the reason, though I did receive other bills from the same hospital visit (and, I just checked, the same apartment-number-less address) without a problem. The person who told me about the extra charge also told me that I would have to deal with the collections agency instead of with the hospital, but that I should be able to get them to send the bill to my insurance.

Okay, infodump over. My question is: given this situation, what do I need to know, if anything, before establishing contact with the collection agency and asking them to bill my insurance? Also, what, if anything, can I do at this stage to mitigate or minimize the impact on my credit? My sense from reading previous AskMes is that collections agencies are not always super above-board in dealing with debtors, and I want to make sure that I am appropriately prepared; on the other hand, many of the previous questions seem to be from people who were either disputing the debt or trying to settle for less than the total, neither of which is my aim here - I just want to get my insurance billed ASAP and to pay the remaining balance in full and move on with my life. Any help navigating potential pitfalls in this process would be appreciated. Thanks all.

posted by anonymous to Work & Money (6 answers total)

Your hospital should have a department who can work with you to get this sorted out, particularly given the fact that you have paid all the other bills. Try to find a number for "patient financial services" or check the hospital's website for a number to contact about having trouble paying your bills (the people in that department work with billing issues, payment plans, etc.). If that doesn't work, there should be a patient advocate or ombudsman on staff at the hospital who can assist you.
posted by goggie at 1:57 PM on January 2, 2013 [1 favorite]

The department that sent the bill into collections should be able to provide you with the contact information for the collections agency. Once they contact you, explain that you have insurance that will pay and you'd like them to be billed. I'd think you're still well within the deadline for timely filing, so they should be able to get paid and bill you for the remainder.
posted by ThePinkSuperhero at 2:40 PM on January 2, 2013

I had a similar "fall through the cracks" bill that went over due after a car accident (I wasn't home for quite a while) all I did is call the number on the bill, give them my insurance information and that was the last I heard of it--they billed my insurance, it was paid and all cleared up. I don't think this is an unusual situation with the chaos of an emergency.
posted by agatha_magatha at 3:21 PM on January 2, 2013

The collection agency is not going to bill your insurance no matter how nicely you ask. Insurance billing is really complicated and collections agencies don't know how to do it - their expertise is entirely in cajoling or coercing money out of individuals, which is a completely separate set of skills. They way I see it you have two options:

1. Try to get the provider you owe the bill to (sounds like the ED physician group?) to cancel the bad debt placement as erroneous and then rebill your insurance once the account is back on their books instead of the collections agency's. It seems really sketchy that your account was placed in collections so quickly anyway - they didn't even try calling you after the mail was returned? It should be possible for them to cancel a collections placement, but they might be reluctant to do it because the process tends to be a pain in the ass, but the thing is, if you have managed care insurance and the provider this bill is from participates with it, the only way you'll get the discounts that are contracted between your provider and insurer applied to your balance is if they're the ones sending the bill, and it may be the only way your insurance will pay at all. If you can get the placement cancelled, get this in writing from the provider's billing office, then check your credit report and dispute anything related to this that shows up.
2. Negotiate directly with the collections agency that holds your debt now; try to get a deal where they'll both close the debt and cancel whatever negative credit reporting they've put out on this in return for your payment, and get everything from them in writing. Like I said, they won't be willing to submit an insurance claim themselves. What you could do would be to submit a claim directly to your insurer yourself (probably they'll have a form for you to do this somewhere on their website), but again this may not work if you have a managed care plan and the provider you owe this bill to participates with it. Option 2 is way less desirable for this reason and because, as you have accurately gathered, collections agencies are often pretty scummy.

posted by strangely stunted trees at 4:08 PM on January 2, 2013

The person who told me about the extra charge also told me that I would have to deal with the collections agency instead of with the hospital, but that I should be able to get them to send the bill to my insurance.

I would call your insurance company first, though, and ask them about the situation. They may have pull with the hospital that you don't.

I'd suggest reading through this PDF about the Fair Debt Collections Act before you deal with them. They may be horrible or they may be surprisingly professional and above board.

Don't explain anything to the collections agency other than the need for them to go to your insurance. They don't care about why it is with them or why you didn't pay the first time. They are not responsible for the billing errors, so don't even get into that with them. If they push back about filing, you should contact the hospital again and let them know. They say you have to go to the collections agency but they do have the option of pulling it back, especially if it is newly placed.
posted by soelo at 6:31 PM on January 2, 2013

My experience doesn't quite line up with what strangely stunted trees says above. There are plenty of medical collections agencies that are willing to (and know how to) bill health insurance, and if the hospital referred your bill to this one after just 90 days, they probably get a big chunk of their revenue from health insurance payments.

Besides that, I'm just echoing what's been said above: call patient financial services for guidance and the contact info, and just get the insurance information to the debt collector.
posted by mismatched at 5:01 PM on January 6, 2013