Medical debts are given less weight: Newer scoring models such as FICO 9 and VantageScore 4.0 weight medical collections less than other types of collections so that they don’t impact a score as much. Medical bills are treated differently than other bills sent to collections-at least as far as your credit report is concerned. Medical collection accounts are treated differently If you make an arrangement to pay off a debt in six months and the provider agrees to it, they shouldn’t send you to collections as long as you make payments as agreed. To prevent medical bills from going to collections while you’re making payments, set up a payment arrangement with the provider and get it in writing. Read: This woman was charged $143,396.66 for a breast biopsy - here are the people working to improve medical billing transparency But for the most part, any unpaid balance is fair game. Protections under the Affordable Care Act give patients at nonprofit hospitals time to apply for financial assistance before any “extraordinary collection measures” are taken. If you’re making small payments-or if you make your payment a few days late when you’re under a payment arrangement-you might discover the provider has turned the bill over to collections. Making payments on a medical bill doesn’t necessarily keep it out of collections. Your medical bills can be sent to collections, even if you’re paying If you have questions about why something wasn’t covered, reach out to the provider and your insurance company. Be sure to go through these important documents carefully to ensure you understand what your estimated out-of-pocket costs are. Insurance companies usually send out an Explanation of Benefits (EOB) before you receive a bill from the provider. It’s always best to be prepared for the worst to prevent anything from being sent to collections. Due to how a visit or procedure is billed with insurance, this isn’t always the case. A lot of people are under the impression that their insurance will cover all medical costs, so they don’t owe anything. It’s a consumer’s obligation to know what they’re responsible for paying. Here are four common medical bill myths that can cost you dearly and the truth you need to manage your credit and medical expenses more proactively. Many times, medical bills hit collections because you didn’t even realize you owed anything.
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