Debt Collection Questions - What do the dead owe?
May 27, 2016 7:45 AM   Subscribe

I have some medical bills that my late husband apparently accrued in the last months of his life. I've been trying to figure out for what and how to get them covered by his insurance for months now and it appears that it's gone to collections. What should I do?

I live in California as did my husband, who died last fall. In a last ditch effort to treat his cancer, his California doctor referred him to University of Washington Medical Center for proton therapy.

This was all cleared by his Cigna insurance (separate from my insurance with another carrier) and he proceeded to get three weeks of treatment there. During that time and for weeks afterward, we received boatloads of claim notices from Cigna covering thousands of dollars (hundreds of thousands, probably) of treatment. Some said they were fully but covered some didn't but then we'd get a revised thing and none of the actual bills ever made sense as to why we owed what we owed but there was very little that we ended up owing. Due to the fact that he was quite ill and died shortly thereafter, it was all a bit of a blur and I probably wasn't paying as close attention as I should.

I got a bill in January for about $2,000 and I called the Medical Center to try to figure out what it was for and they said I should ignore it for now since they were still working on getting Cigna to pay. In February I got the same bill, which I ignored. I got the same bill in March and called them and talked to a probably a half dozen people at the proton center, the physician's billing group and the medical center and could only get as far as being told that one day of his three week treatment stay wasn't authorized and I went through another round of trying to get it retroactively authorized but was basically told again, let us work it out, we'll get back to you. At one point I had both insurance and the medical center on a conference call and no one had a way forward.

Mid-May I got a note from Healthcare Recovery Solutions asking that I pay the full amount to the Medical Center or it would be "turned over for further collection efforts by a collection agency."

I feel like I've been trying to get this resolved but have no idea where to turn at this point as both the Medical Center and the insurance are pointing at each other. What does one do in this situation? I guess I'm liable for my husband's debts (the bill is in his name)? What happens if I ignore it still? Can I make them an offer to pay a portion of it and just have it all go away?
posted by anonymous to Work & Money (15 answers total) 5 users marked this as a favorite
I had a similar back-and-forth over a medical bill for me and it took months to be resolved. I asked the billing office to put a hold on collections while it was sorted out with the insurance company. Try calling them again and asking them to do that until it gets resolved. This sort of thing happens all the time.

I am sorry for your loss.
posted by bedhead at 7:53 AM on May 27, 2016 [1 favorite]

The first thing you should do is never pay this bill. NEVER. Don't pay a cent. That place doesn't need the $2k more than you do. What's the worst that can happen, they take you to court for it? Go to court. Judges are sympathetic to stories like yours. Never, ever, ever pay this bill.

You should escalate within the medical center- email EVERYONE. The doctor, the department chief, patient services, the dean, the medical director, all of the executives for the faculty practice group, the president of the university, anyone you can find. Raise a big stink about it, lay out all the details you have about who you spoke and all the times they told you they were going to work this out and now it seems like you're in collections (which it sounds like you aren't, but let 'em think you think you are). Somebody has the power to pull the account back from collections or put any further collections efforts on hold, and ultimately eat the money they didn't get, and they should, because it was their fault they didn't get the one-day of authorization. Never, ever, ever pay this bill.

Just ignore whatever outside firms try to contact you- tell them they should call (the names of the people you're in touch with at the medical center) and get the full story. Pay no one.
posted by ThePinkSuperhero at 8:10 AM on May 27, 2016 [29 favorites]

Also a good idea to document the attempts you have made as much as possible -- who you talked to, when, what was discussed, etc. It helps if you can show/prove your efforts to resolve the issue, so that there is no possibility of you appearing to be trying to not pay.
posted by cubby at 8:19 AM on May 27, 2016 [3 favorites]

In California, you may be responsible for your spouse's debts. You need to speak with a lawyer to be sure - is there one that handled the probate?

In any case, if there was an estate, it would be liable for the debt. Again, California's communal property law may affect this and the best answer will come from a lawyer that practices in CA.

If you can't afford to have your credit trashed by this, it may be best to pay the fee to prevent late charges and interest from jacking it up and then claw the money back from the insurance company.

I'm sorry for your loss.
posted by Candleman at 8:24 AM on May 27, 2016 [3 favorites]

Ordinarily, you could tell them to go eff themselves, but unfortunately you are in a community property state.

I would call the California Department of Insurance hotline to complain. Often they can help sort out matters like this--where it's not so much a question of legitimately denied coverage as confusion and bureaucratic stupidity.

I'm very sorry for your loss, and sorry you are having to deal with this extra pressure on top of your grief.
posted by praemunire at 9:26 AM on May 27, 2016 [6 favorites]

I don't have any specific advice for these bills except to say that now would be a very good time to familiarize yourself with the Fair Debt Collection Practices Act. Learn this stuff - it could save you a lot of trouble.

I'm sorry for your loss. I'm also sorry that you've got this hassle on top of that.
posted by azpenguin at 10:18 AM on May 27, 2016 [2 favorites]

I would strongly suggest that you make decisions based on legal advice rather than arguments from emotion. I can assure you from firsthand experience (albeit in a much different state) that hospitals can and will pursue medical debt against estates. If you need to have a decent credit score in the next seven years, having a debt go to collections will damage it quite a bit.
posted by Candleman at 10:26 AM on May 27, 2016 [1 favorite]

Please do call the California Department of Insurance listed above. They should help you for free.

I worked in insurance. Two things that will get your problem looked at more closely is a) threatening to go to your state's insurance commissioner (this is called the California Department of Insurance in your state -- they are a consumer advocate) and B) lawyering up and having your lawyer request a copy of all records.

You will have to submit a third party Authorization to get the records released to a lawyer. Most people seem to not know this. So, typically, the company gets a letter from a lawyer and responds by sending a blank third party auth. If you send the fully and properly filled out auth with the initial request, this will make you and your lawyer look more competent than 99% of people. Here is a link to Cigna's forms page. You need the second from the bottom where it says:

If you want to allow someone else (such as a spouse, friend or attorney) to access your health care information, use this form:
Authorization for Disclosure of Protected Health Information English | Español | Chinese

If you find the form confusing, do not hesitate to call Cigna and ask questions about how to fill it out. I didn't even work in customer support and called someone to walk them through the process after getting multiple incorrect auths.

Also, appeal to emotion in this case does have some value. So, make sure you are communicating that you are this man's widow and you believed that the treatment was all preauthorized and it would be a shame to have Cigna's reputation dragged through the mud unnecessarily over what is probably a run of the mill bureaucratic snafu. But this is stressing you out and you would really like this resolved as quickly and quietly as possible.
posted by Michele in California at 12:06 PM on May 27, 2016 [1 favorite]

I'm an attorney with experience in debt collection. I am not your attorney, and I am not licensed to practice law in California. Obviously, therefore, I cannot give you legal advice.

I can, however, tell you that these are some instances of advice in this thread that range from gently misguided (FDCPA applies to debt collectors, not original creditors) to spectacularly poor (do not "just ignore" third parties who may contact you regarding this matter) and the thread is therefore a neat illustration of what happens when you ask pretend Internet attorneys, "What should I do?", rather than asking the more sensible, "Tell me about your experiences that might be similar and what you did, or what you would do differently."

Your state or county bar association can likely refer you to a licensed attorney in your jurisdiction, and your local courthouses and libraries may be able to direct you to free or low-cost legal aid services if you qualify. Generally speaking, I would say that most things in life are negotiable and that squeaky wheels get greased. Good luck.
posted by cribcage at 4:26 PM on May 27, 2016 [9 favorites]

I would start by calling the Medical Center and ask that it not be turned over to a third party agency for collection since they still have not been able to provide you a clear statement as to what was owed since they are still trying to work it out with the insurance company. I have had stuff takes months to be cleared up - this seems normal to me - so I would hope that the person you talk to (or their supervisor) would agree to hold off until they could give you a clear accounting and a reasonable time (at least 30 days) to pay it. This worked for me when our clinic messed up their bills - although I had to call and as more than once while they got it straightened out.

When my daughter got a bill sent to collections agency that (i) should have been sent to insurance first but now it was past the deadline and (2) we had never seen before, we sent them a letter saying that we didn't believe that we owed that amount and please provide documentation of the debt. We never heard from them again. That may not be typical but it worked for us.

If you do get charged, do try to check with an insurance lawyer if you can afford it or the state insurance office and maybe even Cigna. There may be rules in their Cigna contract or in state law about them charging you if they failed to get timely authorization and didn't notify you. I'm not at all sure but add that into the other considerations and you will want accurate advice on the best way to handle it. You also need some to tell you if it is California or Washington law that relevant here - I saw many people referring you California resources but since the facility is in Washington, their law may prevail. IANAL (obviously)
posted by metahawk at 4:52 PM on May 27, 2016 [1 favorite]

gently misguided (FDCPA applies to debt collectors, not original creditors

It wasn't me who mentioned the FDCPA, but if you don't see a name like "Healthcare Recovery Solutions" and know instantly that they're some shady third-party type, you're in the wrong game.
posted by praemunire at 6:03 PM on May 27, 2016

"I can, however, tell you that these are some instances of advice in this thread that range from gently misguided (FDCPA applies to debt collectors, not original creditors"

While I'd defer to your expertise, seeing that this is your field, I'm of the belief that everyone should know their rights under the FDCPA. (She did say that they said the bill would be turned over to a collection agency; wouldn't it apply then?) People that know their rights can make sure they talk to an attorney if needed BEFORE they say something to a debt collector that puts them in a bad spot. (And especially if they start getting phone calls about debts the caller claims the deceased person owes.)
posted by azpenguin at 6:29 PM on May 27, 2016

I'm of the belief that everyone should know their rights under the FDCPA.

There are two problems with the FDCPA.

The first isn't relevant to this thread, but for conversation's sake: Congress intended the FDCPA to be deterrent. The idea was to make certain practices unlawful—and by prescribing statutory damages and attorney fees where those practices occurred, to make it simple for attorneys to help clients sue for those practices. The principle is sound. If any and every attorney can press an FDCPA claim, easy as pie, then collection agencies would become paranoid about adhering to the law.

But that's not what happened. Instead, FDCPA claims became a cottage industry. Most attorneys don't care whether it's easy to press an FDCPA claim. They deride collections practice on both sides, and they just want to close the file ASAP. If that means ignoring FDCPA violations, oh well. They just roll their eyes. In practice only a few attorneys take up FDCPA claims, almost as their bread and butter. Because they are few, they quickly become known to the collections agencies and develop relationships that are almost symbiotic. The result is that FDCPA claims aren't really deterrent. They are a measurable, and accepted, cost for collection agencies.

The second problem with the FDCPA, more relevant to this thread, is that it became PopLaw. There are dozens of websites and discussion forums devoted to trading scripts for telephone calls, form letters, even model pleadings that purport to be based on the FDCPA. It's just accessible enough that Tom and Dick and Harry believe they can handle it pro se. (There's a reason why Congress provided for attorney fees in the FDCPA.) And unfortunately, Tom and Dick and Harry end up digging themselves deeper into a hole, wasting time and money and sometimes disadvantaging their own positions, because they believed something was true "under the FDCPA."

I don't disagree with you that it would be great if everybody knew their rights under the FDCPA. It's easier said than done. A lot of people read the FDCPA, believe they understand it, and are wrong.
posted by cribcage at 7:37 PM on May 27, 2016 [2 favorites]

I wouldn't advocate someone using the FDCPA as a self guided legal strategy, or as a way to get out of debts you owe. (Online "legal experts" who think their 30 minutes on Google are as good as years of a legal education and experience... they'd be amusing if they weren't causing real damage to peoples' lives.) If you owe it, you owe it. I've seen people, though, that will engage a debt collector when they call without asking for verification of the debt. If I get a phone call, I'm not engaging you any further until you prove to me in writing that I owe the stated amount and that you're the one I owe the money to. People should at least know the basics of the law like that. People who don't... well, that's how things like the IRS phone scammers make their money.
posted by azpenguin at 11:07 PM on May 27, 2016

Verification (or validation) is a good example of my point. The FDCPA entitles consumers to "verification" but neglects to define what that term means. Federal courts across the country have stumbled over the word, and there are some complications depending on facts like whether a consumer has disputed a specific part of the debt, but the distilled takeaway is that (1) verification is a low bar, and (2) if the debt collector gives you a reasonable explanation as to the amount and origin of the debt, then verification has probably been satisfied.

But people read the FDCPA itself or via so-called consumer websites, and they believe that verification entitled them to every bit of paperwork related to the debt. Often they believe they are entitled to more documentation than the debt collector would be required to produce in order to prove its case in court. In fact, the FDCPA's "verification" requirement is so easily satisfied, it's almost silly. It only screens out the scammiest of the scams.

That's why, when various states enacted their own versions of the FDCPA, the verification provision is one section that is often tweaked. For instance in Massachusetts, verification also requires "all documents, including electronic records or images, which bear the signature of the debtor and which concern the debt being collected." Even this isn't really a high bar, as the debt collector can satisfy this requirement by stating that it has reviewed its records and does not have any such documents. But the point is, the FDCPA doesn't even require that: if a debt collector has your blue-ink signed application, the debt collector can withhold that document and still probably satisfy verification.

Moreover, if a debt collector fails to verify a debt, people often misunderstand the consequence. It doesn't erase your debt. It doesn't really affect the debt one iota except that this particular debt collector must cease collection activity. So for instance, if a judgment was obtained against you but the debt collector cannot obtain a copy of that judgment, then the debt collector may be prohibited from continuing collection activity. But you still have an adverse judgment that can cause myriad problems.

In this instance, the OP appears already to have a lot of information about the debt. I'm not the OP's attorney, and I cannot counsel the OP whether to request verification from a debt collector. But generally speaking, if you're going to do something, know your reason. This is something a California-licensed attorney (which I'm not) can help with.
posted by cribcage at 7:40 AM on May 28, 2016 [1 favorite]

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