5 common medical bill myths debunked

Category: Medical expenses


When you need medical care and don’t have the money or insurance to cover the costs, most healthcare providers will be willing to bill you.

Myth #1. If an unpaid medical bill is sent to a collection agency, it won’t affect my credit score the same way that an unpaid credit card bill would.

Fact:  Whenever an unpaid debt is sent to a collection agency, it appears on your credit report as a negative item. It doesn’t matter if it’s unpaid credit card debt, an overdue loan payment, or a medical bill that hasn’t been paid in full: your credit score will be impacted the same way.

Myth #2: The medical bill won’t be sent a collection agency as long as I am making payments.

Fact: It’s crucial to make timely payments and never fall behind on your medical debt. If your payments are late or you don’t make the minimum required payments, your credit score may drop. It depends on the laws in your state and the type of medical care you received, but for the most part, any unpaid balance on a medical bill can be turned over to a collection agency.

Myth #3: That medical bill can’t go to a collection agency—I was never notified!

Fact: Although creditors will usually attempt to recover any unpaid debts from you before they turn your account over to collections, they are not required to notify you before doing so. As such, you may not even notice that this has happened until it’s too late and you notice it on your credit report.

Myth #4: As long as I pay my unpaid medical debt, any negative repercussions will automatically be reversed.

Fact: Not necessarily. Once an account has been turned over to a collection agency and this is reflected on your credit report, your score is already affected and it could be difficult to bounce back from. Although you will see a difference by paying off the debt, you may not notice anything drastic. Negative items are never permanent on a credit record, so they will eventually be removed—but you could use this as a bargaining chip with the collection agency. Tell them that you will pay off the debt, but you will need a promise (in writing) that the negative mark will be removed from your report.

Myth #5: If I have unpaid medical debt that has already been sent to collections, I probably shouldn’t even pay it if it won’t make much of a difference in my credit score.

Fact: Even if you don’t see a major improvement in your credit score, it’s still important to pay off the debt. Otherwise, you could be sued for the unpaid debt, which can result in a judgment. Not only can this wreak havoc on your credit score, but you may also be subjected to wage garnishment.

Are you currently facing a tremendous amount of medical debt and feel you have nowhere to turn? Are you receiving structured settlement payments as the result of a personal injury lawsuit? If the periodic payment schedule is no longer convenient for you and you’ve got bills to pay, Peachtree Financial Solutions may be able to help. We can provide you with a lump sum payment for the sale of your future payments. Depending on how large of a lump sum you need, you may only need to sell a portion of your future payments. The decision is yours! To learn more about how you can receive a lump sum payment to help eliminate your debt and take care of medical bills, contact Peachtree Financial Solutions today.

Nothing above is meant to provide financial or tax advice. You should meet with appropriate professionals for such services. 

Tags: medical bills, medical debt

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