Jimmy Conway said:
Long story short - Had a medical bill, I thought my insurance should have covered it, insurance did not, I argued with the insurance company for 8 months over it, and in the mean time it went to collections. Now it looks like I am not going to win my argument and need to pay it regardless.
That said, I'm getting notices from the doctors office AND collections. Collections is knocking 20% off the bill as a "Settlement" . Doctors office is in full. Which one am I better off paying to get this off my credit quicker?
Okay, first step is to take a deep breathe and relax. People freak out over debt collectors, its mostly barking and very little biting. They have two real options, ding your credit or take you to small claims. They really don't want to take you to small claims. Thats extra effort and they've got a lot of debt to go chase down. They want you to settle beforehand.
Your first thing to figure out is 'who actually should be paying this.' insurance and the doctor are both shirking their duty to figure it out. That'll help sort out the end stage of this debt. Is the debt collector willing to take you to small claims court and have to explain to a judge this scenario? Is there some murky gray area or billing error?
The second thing to figure out is where is the debt currently residing? Most companies now don't sell their debt to debt collectors immediately or within 6 months, they put it in an in house debt collection group thats tasked with maximizing recovery. So check to see if its truly been sold to a 3rd party debt collector, of its just sitting in some other group at major hospital corp. They get sneaky here. You'll see professional letterheads from groups you don't recognize and then on the back in very fine grey lettering it'll say B&SW Hospital.
If the debt is with the hospital or group, they aren't going to take much off the top. Most I've seen those guys offer is 20-30%. You talk to them long enough and they'll say something like, end of year sale: take an extra X% off. They have numbers they've got to hit just like you do.
The hospital will do one of two things at 6 months. Decide to put it out there on commission to a real debt collector or keep it in house and keep harassing you. Only after a year or so do they really start getting serious about trying to bargain here or sell it.
If it gets sold to a real debt collector, you win. They buy it pennies on the dollar. You talk to them and say, hey man you got this debt for less than 10%, I'll pay 30% today in cash and lets be done with it.
If they piss and moan just tell em to call you back when they're ready to take the deal.
Source: I hate hospital billing.
