Am I being lied to about being turned over to collections?

I live in Georgia - and I have a few doctor bills that my insurance did not cover. I am on a modest income for medical reasons and have been making small but consistant payments every month on my bills ($2-$5) - According to the offices I do not qualify for uncompensated services because the bill amounts are under $100. The doctors and hospitals I owe are threatening to turn my accounts over to collections. I thought as long as I was making a payment every month that they could not do this, as I am showing good faith in trying to repay the bills. Am I wrong?

You are not being lied to, but the situation is very unlikely.

Indeed, your account can go to collections at any time. However, making payments (any amount) definitely helps your case as it is paying the account down.

Another good situation is that the bills are so small (unless there are a whole bunch of them). No sense paying an attorney or collection agency more money than the account is worth. Also, being under $100 prevents them from being reported on your credit bureau.

The last I checked the minimum amount to be reported was about $500.

Your good faith payments and the size of the bills will probably keep them from going to collections or an attorney.

if you owe, you owe. and any business you owe money to can turn your account over to a collection firm to recover the payment. it is what it is.

It seems like more and more doctors/hospitals are requiring $20-$35 minimum payments. I had made payments of $20 for one of my bills for three months. They kept calling me and wanting more payment. I told them I could only afford $20 a month and there response was to STOP sending me bills entirely, then claimed I wasn't paying at all and sent the bill to collections. Hospitals are getting extremely hard to deal with, so I would say it is very possible they're not lying. It's hard to deal with when you're on a modest income, and I'm sorry for you, but you just have to keep trying to reason with them or they may actually turn you over to collections. Good luck talking to them.

Don't wait for them to call you again.

Call their billing department, tell them the type of calls you have been receiving and ask them what WOULD be an acceptable payment.

Try to work out an arrangement. They are allowed to turn you over to collections, but may change their mind (let you make arrangements) if you call them and they see that you are taking a proactive role in resolving the matter.

Good luck.

They can actually do that, as there is no such law or rule stating that they cannot send you to collections if you are making those small payments. The simple fact of the matter is that they can send you off to collections if you do not meet the minimum payments as determined by the agreement.

But here is where I think they are blowing smoke. You stated that these bills are under $100. When they send it to collections they LOSE money. They either do a charge off, where they write it off as a loss on their taxes and sell the debt for pennies on the dollar, or they assign the debt to a collection agency who gets to keep a percentage of what they collect.

Even at only $5 a month, the debts will be paid in no more than 20 months, which I think is pretty darn reasonable for a medical bill on someone with a limited income.

I would call back them back, maybe speak to a supervisor and explain that you know how the game is played and that there is no reason for both of you to take a hit on this as you are doing the best you can.

If they won't work with you, well you did the best you could.

If they send it to collections you have an advantage in that you can save up the money you were paying them and offer the collection agency 50%-70% of the balance owed in lump sum in exchange for them deleting it from your credit report...this is called a pay for delete agreement and is totally legal.

And I am not sure about the reporting like Greg mentioned. I have never heard of this. However I can tell you that the $500 minimum is incorrect unless it just went through the last couple years. I have a collection on my report of $118 from 2005.

Crazy's answer is great.

Greg is wrong....they can and do report for any amount. I've seen reports listing $18 debts!

Here is probably what your trouble is. Because of the complexity of medical billing, many doctors offices are using contractors to handle all of their billing. And they take all of their delinquent accounts and go after them quite agressively.

Now, understand that collectors are hired based on their lack of intelligence and compassion. A $5 is no different then a $5,000 debt to them, and they will act accordingly.

And trust me on this....there is a large collection agency that purchased a huge portfolio of medical debts from the local hospitals and medical practices in my area...many millions of dollars in debts. They are trying to recruit me something awful to become a collector. Not interested...I'm not that desperate for the job.

Many of these debts are pretty much the case of insurance companies dropping the ball, and the patient is stuck with the bills.

What you need to do is contact the doctor/hospital directly and discuss this with them. Bypass the collections people totally if you can.

If this goes to collections, it will end up on your credit report. And a debt of $100 looks just as bad as $5000, regardless if it's paid or not.

So use that bit of info for leverage. Tell them you are trying, but if they put this on your credit report you will stop paying all together. They are NOT going to sue you for such a small debt. And if they do, you can explain to the judge that you were trying but they didn't wish to cooperate. In MY county, where they have some decent judges, they would order an installment plan of $5 for you. (Doesn't help your credit score though...)

So call the doctors office and see what they will do for you.

Did you get an agreement with them to let you pay $2 or $5 per month, or did you just decide on your own to do it?

I would make up a statement of income (your income and a list of monthly expenses like rent, groceries, electricity, etc) and show them that you really can only afford to pay them what you're giving them. They're not entitled to personal information like check stubs or copies of bills, but if they request them and you think it would help you out, you can give it to them.

They are able to send you to collections even if you're making payments, most places won't if it's a significant amount, but $2 a month, would look to me like someone just giving enough to keep out of trouble.