From a reader:
I received a call from a collections agency today about a bill from a doctors office. I have never had a bill go to collections in my life, and I've always paid immediately. Evidently my insurance didn't cover the services the doctor provided (a little over a year ago now). However, I never received any bills from the doctor for the amount owed; after a year they just sent it over the collections. I paid immediately when I got the call from the agency, but I am now concerned about my credit rating. I know when a debt goes to collection, even if it's paid, it shows up on your credit report. I had excellent credit before, and now I am afraid I am going to get docked points. How could the doctors office send my bill to collections when they never even sent me a bill or contacted me?
What advice would you give her?
I am wondering if it is too late? I wonder if they could have called the doctor's office to question why they sent them to collections without ever sending them a bill...and maybe have negotiated to pay the doctor's office directly if they removed them from collections. I'm wondering if you call the colleciton agency and state that you never received a bill from the doctor office, if you can ask that they not report it to the agencies, especially since you paid in full. My one recommendation, keep all records of the history, the bills/statements/receipts/copies of checks, etc in case they ever try to contact you again.
Here's a good YahooAnswers question I found on the matter: http://answers.yahoo.com/question/index?qid=20080710143226AARjsJw
Posted by: Mark | September 18, 2008 at 03:49 PM
The debt won't necessarily go to the credit report. But its quite possible. You could do the annual free credit report check to see if you haven't done one yet this year.
Its quite possible that your Doctor was sending the bill notices to the wrong address. I got into that situation years ago with someone sending a bill I owed to the wrong address and then they sent me to collections. Or they may have simply made a clerical error on their side.
The exact laws may depend on what state you are in but its quite likely there isn't a legal requirement for them to do anything special before sending a bill to collections. I don't see any federal law requiring them to do anything before they send your debt to collections. So your Dr. may be OK to do this legally. Generally I think the person who owes the bill is responsible for paying it and making sure they have your current address.
Did you call the Doctor office to find out what happened? There might be a simple explanation.
There are some laws to keep overly aggressive debt collection agencies in check:
http://www.ftc.gov/bcp/edu/pubs/consumer/credit/cre18.shtm
Jim
Posted by: Jim | September 18, 2008 at 04:16 PM
Rule number one: Make them send you a letter detailing the charges and time frame. Never trust a collections call without seeing it in writing! Then compare the letter to the EOB from your insurance provider. It is possible the insurance paid and the doctor's billing (most doctors use a billing agency or such) did not record it properly (hence a bill was never generated). Always keep and inspect your EOB's from insurance providers to make sure they paid and know what they refused to pay!
Posted by: zOrville | September 18, 2008 at 04:57 PM
I can tell you this. A doctor once tried to bill us for what had been an incorrect diagnosis. It turned out that my wife was feeling nauseous not because she was lacking an expensive medicine he could prescribe but because she was pregnant with our oldest boy.
We told the doctor we wouldn't pay for this and we didn't.
In time we got a call from the collection agency. I told them the story and that we wouldn't pay. We never heard from them again and never saw a reference on our credit report.
Your mileage may vary.
Posted by: Servius | September 18, 2008 at 05:13 PM
I can tell you this. A doctor once tried to bill us for what had been an incorrect diagnosis. It turned out that my wife was feeling nauseous not because she was lacking an expensive medicine he could prescribe but because she was pregnant with our oldest boy.
We told the doctor we wouldn't pay for this and we didn't.
In time we got a call from the collection agency. I told them the story and that we wouldn't pay. We never heard from them again and never saw a reference on our credit report.
Your mileage may vary.
Posted by: Servius | September 18, 2008 at 05:13 PM
She should make sure that this is not a "balance billing" situation. If so, she is not responsible for the bill. (She can google "balance billing" or I have a post about it on my blog.)
Posted by: Mr. ToughMoneyLove | September 18, 2008 at 05:14 PM
Clark Howard is usually all over the collection agencies and what to do. Tune in to his show or check out his website.
Posted by: Anonymous | September 18, 2008 at 05:42 PM
I had a similar experience and was told that there was some sort of grace period and it wouldn't appear on your credit report so long as you paid it within a certain amount of time. I got it taken care of right away and nothing ever showed up on my credit report.
In my case, it appears as if a bill was sent, but just to the wrong address. I received a bill from collections and the address on it was wrong, so chances are the bills from the doctor's office had the wrong address as well. I'm just lucky that something eventually did get to me.
Posted by: Alison @ This Wasn't In The Plan | September 18, 2008 at 05:52 PM
I would call the doctor's office on this. See if they actually sent you to collection. In the area I live, there was a scam going on with a bogus collection agency ripping people off. They got access to the local hospital's accounting database.
Posted by: | September 18, 2008 at 07:58 PM
Yes, I've had a similar situation 2 or 3 times actually, and have always just gotten the information about the debt from the collector so that I could then pay the original biller directly. The doc's offices I dealt with went along with this without me even having to get pushy about it, but even if they hadn't, I was able to confirm that the bill collector was legit before I sent them any money.
Posted by: Gavagirl | September 18, 2008 at 08:18 PM
The problem is that she already paid the collections agency; what she should have done is call the doctor's office and offer to pay THEM (if in fact she owes the money) - then have them remove the item from collections on their end.
I would still call the doctor's office and ask them about it, and make sure they take the bill out of collections to the extent that they are able (though it may now be out of their hands since you paid the collectors). See if the doctor's office will let the collections agency know that they sent your bill to them in error.
The collections agency is the entity that chooses whether or not to report their items to the credit bureau. They are the ones you need to talk to. Perhaps since you paid immediately it won't go; I once had something similar happen with a phone company payment I apparently owed. I paid the collections ppl immediately, and asked them about my credit; they said since I paid within 30 days that they wouldn't report it.
Posted by: Meg | September 19, 2008 at 05:41 PM
Get a copy of your free credit report to be sure. Personally I've never had one of those show up on mine. You should be fine since you paid it so quickly.
I track my claims on the insurance companies website now to avoid these situations. I even go so far as to proactively contact the office when I catch an error or notice a charge (such as radiology for an xray) has not been submitted to my insurance.
Dr's billing services are notorious for submitting claims to old insurance carriers and former addresses. It happens so frequently I'm not sure what the purpose of presenting my current insurance card and filling out the paperwork with my current address is.
Posted by: Ken | September 19, 2008 at 10:44 PM