A Legal Necessity For Healthcare Providers
Some tales about medical bill collections invoke images of well-written Hollywood scripts. The patients are ordinary individuals who are suddenly thrown out of their houses or arrested because they could not afford to cover their medical bills for lifetime-saving medical treatment. The bad guys are doctors or hospitals that eagerly pursue every last dime they are owed by these helpless patients. But for how many of the stories really are made up? And how true are the incidents described in them?
For some patients, receiving a bill for more than they expected is simply a result of being too much spendthrift. For other patients, the hospital is the villain. If the hospital or the doctor were named in the medical bill collections, it may cast a terrible shadow over the practice. Many patients worry that if they continue to be held hostage to their medical debts, they will be sued by their insurance companies. This has even led some health insurance companies to drop their patient’s coverage.
There is little doubt about the fact that healthcare providers and hospitals reap huge benefits from medical bill collections. They are able to collect premiums on outstanding balances, gain control over billing practices, and collect long past due payments by patients. However, whether it is the hospital or the insurance company that ultimately pays for the medical debt, both parties are ultimately profiting from the transaction.
For hospital staff, medical bill collections can mean additional revenue and job security. The hospitals must have a collection department on hand to manage all of the medical debts that arise. These bills could include a patient that hasn’t paid their insurance bill within the allotted time or a patient that hasn’t been seen for an extended period of time. When these medical debts are managed effectively, it allows hospitals to maximize the amount of money that they receive in premiums each year and it also gives them the assurance that they will be able to fully staff their departments when they need them.
In turn, patients benefit greatly as well. The majority of healthcare providers will allow their patients to recover any outstanding balance at any time. However, when a patient experiences long delays in paying their bill, it can create negative cash flow situations. When the delay becomes permanent, it can severely affect the bottom line of the hospital or clinics. As such, many hospitals and clinics choose to utilize medical collections to ensure that they will be able to sustain their operations and that their bottom line will not be adversely affected.
One important aspect to consider with medical bill collections is the fact that they will negatively impact a person’s credit report. This is not a huge problem per se, but the potential impact is significant. If a person’s credit report is significantly impacted by medical debt collections, they may find it difficult to obtain any form of credit in the future. In addition to damaging one’s credit report, a medical debt collection could have a negative impact on one’s ability to rent an apartment or secure employment.
When considering the use of medical collections, it is important to note that they are not permitted to communicate with the wrong party in order to collect a debt. They must remain discreet and must remain within the legal boundaries of collecting medical bills. Additionally, if a collection agent attempts to contact a healthcare provider for the first time, it is recommended that they be asked for identification. Many of the credit bureaus will consider a patient to be a patient if they show themselves to be in a valid medical facility. By law, all collections must remain confidential.
While it is true that some healthcare providers do not like to deal with medical debt collection agencies, it is becoming increasingly more common for hospitals to use them as a means of collecting outstanding bills. As healthcare costs continue to rise, it is becoming more important for hospitals to conserve resources. For this reason, many hospitals have implemented policies that limit the types of healthcare facilities that can use medical collection agents and limit the amount of healthcare services that a hospital can purchase from outside vendors. In recent years, hospital staffs have begun using electronic health records, or EHR, to track all medical bills and avoid the need to use hospital personnel to retrieve information that would qualify them for a payment.