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How to Beat Unsubstantiated Medical Bills

Reviewed by Tanza Loudenback

Do you have a medical bill that’s already been sent to collections? You might be feeling sicker about the debt than you were about the — well — sickness. But we’re here to help. And relax, we won’t be donning any rubber gloves.

Let's get started by examining some important legislation. Wait, come back! Ok, we’ll just show you how this law works in your favor. The Fair Debt Collections Practices Act might sound daunting, but it’s going to be your best friend when trying to dodge unlawful medical collections. Here’s how this important piece of law can protect you.

If you have a medical bill that’s already gone to collections, this part will feel like a review, but bear with us. When a medical provider doesn’t receive timely payments for the services they’ve rendered, they won’t spend too much time asking you why you haven’t paid or when they can
expect subsequent installments. They’re more likely to turn the unpaid debt over to a collections agency.

Here's the first step you need to consider. When this transfer happens, the original provider is essentially out of the game. Your new debtor/creditor relationship is with the collections agency. And they are required to notify you that the debt in question now sits with them. After the collections agency contacts you, they’re also legally obligated to send you written notice within five days that clearly states the amount of the debt. That written notice must also inform you that you’re entitled to request a debt verification within 30 days.

Suppose they don't send you that letter within five days of first having contacted you? Then you won without even having to fight. Simply send the collections agency a letter that tells them they violated the Fair Debt Collections Practices Act by failing to notify you of your right to
request a debt verification within five days (which means the debt is no longer valid).

So, what happens if they do send you that letter? That means it’s time to take them up on the offer of requesting the second part of their obligation — the debt verification. It’s up to you to ask for a letter of validation. That’s essentially proof of exactly what you owe plus a few other
particulars. It’s a pretty thorough document.

In addition to the part you’re primarily concerned with (the dollars and cents you owe) this validation must provide you with a name or description of the services provided, the amount of time that the debt has been outstanding, the date and amount of your most recent payment, the interest rate that your remaining debt carries, and of course instructions on how to make
future payments should you choose to do so.

But wait, there’s more! Sorry, we couldn’t resist. The collections agency must establish that you agreed to pay the debt in the first place. That means they must:

  • Reference a document that explicitly says you agree to pay the debt
  • Demonstrate that such an agreement includes your signature
  • Reference a HIPAA release saying they have permission to access your protected data

When requesting a letter of validation, be sure to send it via certified mail. Remember, you’ve decided to pick apart the collections agency’s paperwork so you’ve got to make sure they aren’t able to call your own into question. Certified mail assures you that you’ll have written confirmation of the collections agency’s receipt of your letter.

Once you get confirmation that your request has been delivered, you’ve effectively pushed a new set of tasks to the top of the agency’s queue. And they must fulfill your request before continuing to collect the debt.

Should they provide you with a letter of validation that includes all of the documentation we listed, the ball is back in your court. Often enough, however, the work required to satisfy your request just isn’t worth their time. Of course, in some cases, the documentation does not, in fact, exist. So, if no letter of validation comes to you or if it is incomplete, it’s time to write
letter number two. Don’t worry — you’re almost home free.

Your second certified letter (yes, this one too should definitely be a certified letter) should tell the collections agency they failed to validate your debt. This, you will surely tell them, is a violation of The Fair Debt Collection Practices Act. The cherry on top? A polite, but firm reminder that they are legally obligated to now dismiss your debt or be reported to the federal
trade commission.

Fingers crossed that the next communication you receive (if one shows up at all) is a confirmation that the debt has been expunged. And remember to save copies of all the correspondence you both wrote and received should any discrepancies appear on your credit report.

Betty Lutz is Compare Credit’s assigning editor. Her areas of expertise include personal finance, business software and tech.

Tanza Loudenback is a CFP® certificant, writer, and editor. From 2015 to 2021, she was a top-read author and editor at Business Insider. Her work focuses on helping people make smart decisions with their money and is published by a variety of online publications. Full Bio

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