A husband and wife in their late fifties come in to the office with a problem. All of a sudden their interest rates in their credit cards went up without warning. They were generally frugal people who used the cards conservatively and couldn’t understand what happened. I pulled their credit report and found three unpaid medical bills. The bills were from tests the husband had submitted to as part of treatment for an illness. I don’t understand, the husband said, I thought my insurance had covered those tests!!
After some discussion, they revealed that their coverage was with an HMO. This was not the first incident I had encountered where an HMO was involved. They are notorious for refusing to pay certain medical costs for a number of reasons, the most common reason being not getting prior approval from them before a procedure is performed.
So I asked him if he had remembered receiving a statement from the medical lab for the cost of the tests. Neither he or his wife could remember. You know, he said, I received so much paper after that procedure I ended up totally confused. This is not a bill, or this is a bill, or you may owe part but not all of this bill. I was inundated with the stuff. If we did receive the bills we probably ignored them because we thought they would be covered by our insurance.
Here is what happened. The medical lab submitted the bills to the HMO but they refused to pay due to the prior approval issue. The lab then sent the bills to the patient who mistakenly ignored them. After two or three attempts to get the patient to pay, they referred the account to a collection agency, who immediately posted them on their credit report as delinquent accounts. The couple then made their biggest mistake by ignoring the bills from the collection agency. I confirmed all of this by contacting the lab who stated that was the process that took place.
Fortunately, the amounts on the bills was relatively small and I was able to walk them through the settlement process with little difficulty.
For more information on how to properly settle a delinquent account you can purchase our handbook entitled “Debt Negotiation” You can order directly from this web site or though Amazon.
Remember!! Check your credit report regularly.