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Top 3 Medical Debt Questions

Whether or not you have health insurance, you have probably seen your medical expenses climb over the last few years. Companies are raising premiums, co-pays and deductibles, and consumers are finding themselves overwhelmed with medical debt.

Here are the top three questions the attorneys at Castle Law Office hear about medical debt.

Do medical bills hurt your credit score?
Typically, unpaid medical bills will only show up on your credit score if the debt has been sent to a collection agency. Rather than report the debt to the three credit reporting agencies, hospitals and medical providers sell these debts to collection agencies for pennies on the dollar. This can happen even as you are trying to negotiate with a provider or determine if your health insurance is going to pay the bill.

If this happens to you, the easiest way to resolve a billing problem is to keep in touch with the provider’s billing department. Negotiate down the bill if you can or work out a payment plan. If the bill has already been sold to a collections agency, offer to pay the bill if they promise to have it removed from your credit report.

Can I negotiate medical debt with collectors?
Collection agencies can afford to take less than the original amount of the debt, simply because they only paid pennies on the dollar for it. You can offer to send them a lump sum – like 25 percent of the bill – and see if they accept it. If not, try a higher amount until you can come to an agreement.

However, once you have come to an agreement on the payment, make sure that they agree to the settlement in writing before you make the payment.

Should I put my medical debt on a credit card?
Generally, this is not a good idea. Putting a medical debt on credit leaves you with no way to negotiate with the provider. And if you are late on a credit card payment, that will definitely go on your credit report and could affect your credit score.

Additionally, transferring medical debt to a credit card could affect your eligibility for charitable organizations or Medicaid. If you have to qualify for Medicaid, some medical costs can be deducted from your gross income to determine eligibility. Medical debt on a credit card may no longer qualify as medical debt.

If you are having trouble with overwhelming medical debt, call us today at 816-842-6200 to speak with an attorney. Or you can email us and schedule your free consultation.


Jason C. Amerine
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President and Owner, Castle Law Office of Kansas City
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