This is new: Hospitals garnishing wages over a $200 bill?

[notposting]

Sounds like that was a business decision by the hospital (which still owned the delinquent account) and the collection agency to not pursue the matter further. Other than dinging your credit, it sounds like you got lucky. Im pretty sure if your amount had been considerably higher, you would have seen a garnishment or a levy etc...

Obviously it costs $ for an agency's lawyer to travel all the way to the venue (usually the county courthouse) where the debt is owed. So small debts like you had usually just rot away until they are declared unserviceable and discharged permanently.

Not sure what the statutes are in your state but when that happens they also disappear from your credit report.

Yeah, at 6 years don't you run a chance of resetting the last contact so to speak? You could pay it, but then they can simply update that you were late and you have a fat negative sit on your credit report for ANOTHER seven years?

 

[Nograts]

I am first going to preface story this with a "this is NOT me". I've learned a long time ago to pay my bills. This one is my brother-in-law who we've been trying to help get turned around over the last year and change, but breaking bad habits and reeducating what was poorly (or never) taught in the first place... yeah, well.

But this story is about hospitals, and this is one that I've never seen before.

Anyway, Mr. Brother-in-Law had a trip to the ER probably about 8 months ago. He has insurance through work, and insurance picked up everything but the copay which was $200. Brother-in-Law doesn't make terribly much, so $200 is about half a week's paycheck on a good week. So he let it slide. And slide it did. He didn't even make an attempt as far as I know. Shame on him. I'm sure it went to collections.

This is where it gets a little weird though. A month or two ago we get a knock on the door. Brother-in-Law gets served. The hospital is taking him to court over said $200 bill. Brother-in-Law idiotically no-shows, so it's a default judgement (he's his own man, sink or swim on his own; we're just providing him a roof over his head). Last night he comes home and tells my wife that they're going to garnish his wages over said bill.

The process is legit, I understand that. I have no problems with that. But this is... wow. I've been rebuilding my own credit for a long time and will likely never be done or satisfied. I've had old hospital bills from children being born or ER visits in the past, some even several years old, some for many times that amount. At worst those bills went to collections. I have never seen a medical bill go through as brief an adjudicated process and end up in garnishment, ever.

Is this a new thing with hospitals?

(And yes, we're trying to re-educate brother-in-law as best we can to make him a functional human being after being screwed over by his parents for far too long. We have him house trained so far...)

Expand on this please, because right now you look like the moron in this story.

 

[notposting]

Still amazed at how bad one of the local hospitals screwed the pooch on billing. Went in the morning after Christmas 2013, and stayed for a couple nights. They tried sending it out to insurance as a $10000 "hospital stay" bill, not broken down. Insurance was like, "pffft, details," and the hospital sat on it for another month before trying to resubmit. Nearly everything got rejected for taking way too long at that month.

Thankfully, that was the end of it. I've been back, and didn't get any free prostate exams or tetanus shots or anything, either, so they didn't put me on a special list of people to mess with, apparently.

 

[NetWareHead]

Yeah, at 6 years don't you run a chance of resetting the last contact so to speak? You could pay it, but then they can simply update that you were late and you have a fat negative sit on your credit report for ANOTHER seven years?

Yeah that is true too (at least as of when I last worked in collections). You might as well let it sit until it expires and removes itself from your record. Even if you make a phone call to ask a simple question and identify yourself as the debtor to the agency, that phone call is documented and identifies as "activity". Therefore the clock resets again; even if the debt was on the cusp of expiring.

 

[SunnyD]

Yeah, at 6 years don't you run a chance of resetting the last contact so to speak? You could pay it, but then they can simply update that you were late and you have a fat negative sit on your credit report for ANOTHER seven years?

Yeah that is true too (at least as of when I last worked in collections). You might as well let it sit until it expires and removes itself from your record. Even if you make a phone call to ask a simple question and identify yourself as the debtor to the agency, that phone call is documented and identifies as "activity". Therefore the clock resets again; even if the debt was on the cusp of expiring.

Yes, that's true. I did it on purpose anyway. At the point I paid it (it would have be 5 years and change) I had already calculated the impact of any old collections versus paid as agreed, etc on my credit. The impacts, especially for medical collections, were minimal. I just wanted all of the old debt hanging over my head paid off and I didn't want to run the risk of anyone coming around looking for me for judgments or anything with their 7 years to screw me over running out.

I did have several at that point that I did purposely let run past the 7 years before I paid off, and I also had negotiated a few pay-for-deletes as well. As I said though, at that point I just wanted to clear the rest of my bad debt and pay my bills.

 

[CountZero]

Yeah that is true too (at least as of when I last worked in collections). You might as well let it sit until it expires and removes itself from your record. Even if you make a phone call to ask a simple question and identify yourself as the debtor to the agency, that phone call is documented and identifies as "activity". Therefore the clock resets again; even if the debt was on the cusp of expiring.

This is wrong. Date of last activity is the last payment made. This is why collection agencies will try to get someone to pay a very very small amount as any payment at all is activity and resets the clock. Re-aging an account without actual activity is against the FCRA. While you can't take them to court for the re-age you can report them to the FTC.

This isn't to say a collection agency won't re-age illegally. Debt collection is basically one set of scumbags (mostly, though not all are scummy) going after another set of scumbags and people down on their luck.

 

[Homerboy]

Statute of Limitations (SOL) resets at ANY payment on the claim. Length of SOL can vary from state to state, but is determined by residency.

Collections =/= garnishment. For $200 it likely will NOT go to garnishment as that will require a small claims suit and most (not all) are not going to sue for sub $500. That being said, if they do sue, and are awarded judgment, then you are responsible for the $200 plus court costs. If it then goes to garnisheeing, there are additional garnishment costs that you are responsible for -- that $200 bill, just ballooned into $1000+

Disclaimer: I've been IT in the collection industry for 10+ years

 

[SunnyD]

For $200 it likely will NOT go to garnishment as that will require a small claims suit and most (not all) are not going to sue for sub $500. That being said, if they do sue, and are awarded judgment, then you are responsible for the $200 plus court costs. If it then goes to garnisheeing, there are additional garnishment costs that you are responsible for -- that $200 bill, just ballooned into $1000+

Oh trust me, it's gone to garnishment at this point. As I said, he was served (technically imho improperly - my "wife" was served with his papers even though she explicitly said she would not accept any papers for him, the servicer left the papers anyway but that's neither here nor there), he skipped the court date and received a judgement. He told us he was informed he was going to be getting wages garnished the other night. *shrug* His problem, not mine.

Honestly, hospitals are a special kind of something these days. I wouldn't put it past them to sue just about anybody for a buck.

 

[ultimatebob]

I believe it. I once got taken to collections for a $30 co-pay that I actually paid but the hospital didn't have a record of processing. Bastards.

 

[highland145]

Honestly, hospitals are a special kind of something these days. I wouldn't put it past them to sue just about anybody for a buck.

Can you blame them for wanting to get paid? Too many don't.

 

[SunnyD]

Can you blame them for wanting to get paid? Too many don't.

They got paid. Brother-in-law has insurance. Multiparty payment structures are ridiculous for healthcare. But that's another story for a different subforum.

(From what I recall, cliffs version of on-job injury was after hours for local urgent care walk-ins or any local doctors, so ER visit was the only option.)

 

[highland145]

They got paid. Brother-in-law has insurance. Multiparty payment structures are ridiculous for healthcare. But that's another story for a different subforum.

(From what I recall, cliffs version of on-job injury was after hours for local urgent care walk-ins or any local doctors, so ER visit was the only option.)

The point being that he owed $200 and it's pretty easy to collect where you are, apparently. Could be wrong, but I've heard that 1/3 don't pay anything. Then add in the medicare/aid cuts....they're going to try for every other penny they can get.


Granted the ginormous markups on basic supplies/meds is ridiculous. Paid $880 for 2 x-rays of my kid's arm, thankfully unbroken. Paid $1700 for the 16 stitches in my leg. Paid, iirc, $2500 for an ER visit for the wife and still got a bill for another $50.

Last year sucked for my medical expenses.

 

[CPA]

I have no issue with the hospital going after him. $200 bill? how can you not pay that. Even if $200 at once is hard. No hospital is going to bitch if you pay them $10 a month.

just send them something.

Hell, in Texas, a hospital is required to allow a payment plan if the bill is $200 or more and you request it.

 

[highland145]

Hell, in Texas, a hospital is required to allow a payment plan if the bill is $200 or more and you request it.

..

 

[PeeluckyDuckee]

The point being that he owed $200 and it's pretty easy to collect where you are, apparently. Could be wrong, but I've heard that 1/3 don't pay anything. Then add in the medicare/aid cuts....they're going to try for every other penny they can get.


Granted the ginormous markups on basic supplies/meds is ridiculous. Paid $880 for 2 x-rays of my kid's arm, thankfully unbroken. Paid $1700 for the 16 stitches in my leg. Paid, iirc, $2500 for an ER visit for the wife and still got a bill for another $50.

Last year sucked for my medical expenses.

For some that can represent a good portion of their annual disposable income. Ouch.

 

[highland145]

For some that can represent a good portion of their annual disposable income. Ouch.

Thankfully, we were able to pay it. I spent $12.5K out of the HSA. Bam, cushion gone. Never reached my deductible. That did include dental (2 crowns, cleanings), new glassed for me, chiro... but still an expensive year I'd like to not repeat.