Reader Question: Medical Collections Never Sent Bill

Lee,
I received a call recently about a $200.00 medical bill from 2009. It was for lab work that my primary care physician had mailed to an outside lab. The CA claimed they just found a number for me which is doubtful seeing that I am the only person with my name in the US and, like everyone else, I have Googled myself in the past and there is plenty of info including my phone number available and has been for years. I also use the same search services like Accurint at my place of employment and I know my info is out there. I requested the original bill by mail and received it which showed it had a very old address of mine listed, hence my never having received it.

I have and have always had a perfect credit score and have never paid a bill late. I'm mad as hell that someone ele's mistake may sully my credit history. I certainly have the means to pay the bill but want to wait to see what if anything can be done to salvage my credit score. Thanks, I have learned much from reading your site although I would have rather not to have ever had to find your site.

---Anonymous

Dear Anonymous,

Most of the frustration I get from clients in regards to collection agencies is related to the collection agency hunting them down and pursuing them endlessly. It's good to remember that collection agencies can be just as frustrating when they don't put forth much effort at all. 

Your first step should be to get copies of all three of your credit reports and see whether the collection agency has already added its trade line to your reports. You can get one free credit report per credit bureau  per year. The ONLY website authorized by the federal government to provide consumers with their free annual credit reports is AnnualCreditReport.com. If you order them anywhere else (including from the credit bureaus) you'll have to give out your credit card number and sign up for some ridiculous program or other. 

If the collection agency's trade line doesn't appear on any of your reports, the solution is as simple as agreeing to pay the bill provided the collection agency agrees not to report it. Problem solved. This is much easier than trying to negotiate a pay-for-delete. You would, of course, need to get this agreement in writing before sending the bill collector a dime. Otherwise, you can pretty much guess what will happen. You'll be out $200 and the collection agency will report your debt as "paid" to the credit bureaus. Paid collections hurt your score just as much as unpaid ones. 

If the collection agency's trade line is already on your credit reports, its time to call the doctor's office. Your primary care physician knows your address and telephone number but not only did the office not bill you, they also (apparently) didn't provide the collection agency with your contact information. Sounds fishy, doesn't it? I'd call the office, ask to be transferred to the person who handles billing and explain very politely what happened. 

Ask why you weren't billed and make it clear that you'd be more than happy to pay this debt, but that because of negligence on the part of either the doctor's office or the collection agency or both, you're now stuck with an undeserved collection on your credit report for seven years. The billing person will likely tell you there is nothing they can do and that you'll have to take it up with the CA. Be prepared for this and inform this individual that only the original creditor can recall the account and there was a clear error here and you need your account recalled. 

If the billing person doesn't help you, talk to the office manager. Talk to the nurse. Talk to anyone you can who will listen. If no one will help, write the doctor a letter. Explain what happened and how distraught you are. Tell him that you've always paid on time and now your credit is damaged due to circumstances completely beyond your control and ask for help. You'd be surprised how well people respond when you use the word "help." Seriously. 

A few years ago my daughter ended up in the hospital while on an out-of-state camping trip. She was transferred to two different hospitals, saw numerous specialists and had two different surgeries in different cities as she was being transported home. As you can probably guess, I got roughly a billion different bills for different services. And then the inevitable happened: I got a threatening collection letter even though I paid every bill in full as soon as it arrived. 

I did everything I've told you to do. In the end, the problem was fixed and the doctor actually called me at home to apologize. He explained that his office uses a third-party billing agency. This billing agency frequently  sent threatening letters for debts that weren't even late. He told me that this has happened with the past few billing agencies he contracted with and that the problem was widespread. He had every intention of trying out yet another agency, but my point here is this: if the collection agency is sloppy and unethical, the doctor probably knows about it and will be willing to help you out. 

Other specialists in this field may disagree with me on this, but I see no need to dispute this debt with the credit bureaus when what you're dealing with is a genuine mistake that can and should be rectified by the creditor. Disputes should be a last resort because, once the collection agency verifies the debt's validity  the credit bureaus can ignore any other disputes on that particular account. So tread carefully and work this out with the doctor's office directly – not the collector. 

Best of luck,

Lee