What to Do If Your Bills Go to Medical Debt Collections

Unexpected doctor and hospital bills can be a major source of stress. Medical expenses may pile up quickly, and it can be frightening if your debt starts to expand beyond your ability to pay it. This is especially true if your unpaid bills end up in medical debt collections.

Medical debt is something that more than 43 million Americans experience. And often, it can be challenging to pay off. If you start to accrue debt and your medical bills go to collections, this situation can affect your credit score and finances. 

Fortunately, when you’re dealing with medical debt collection, there are steps that you can take to relieve this debt and get your bills taken care of. Here are some guidelines to help put you on the right track towards settling your medical debt and prevent accounts from being sent to medical debt collections in the future. 

What is Collections?

If you do not pay your medical bills on time, doctors and hospitals will be contacting you to settle your account. They will only do this for a few months before sending your bills to collections. But what exactly is a collection agency?

medical debt collection

When you have an outstanding bill that companies no longer want to handle, they send it over to a debt collector. This is a third-party agency that collects the unpaid debt from people who have not paid their bills. 

Companies sell your collection accounts to debt collectors because it is typically less costly to use a third-party collections agency rather than spend their own time and resources tracking down the money you owe. 

If you have a medical bill that you think you can’t pay, you should check with your company’s timeline for sending the debt to collections. Once your debt goes to collections, it can affect your finances in several negative ways. 

What Should You Know About Medical Bill Collections?

If your bill goes to medical debt collections, you can expect debt collectors to be continually trying to contact you for the money you owe. This contact happens via letters, phone calls, emails, and sometimes even social media accounts. 

Your bill might even go to collections even if you are making monthly payments. This can happen if you’re late on your payments or your payments are too small. If you have a payment plan with your doctor or hospital, get the plan in writing, and understand exactly what your payment responsibility is. 

Medical collections are a bit different than regular collections. Medical collections are weighted less on your credit score, so they won’t affect your credit as much as other debt. You have a 180-day grace period before your medical debt appears on your credit score. Once you pay off your medical debt, it will drop off right away.

What Steps Should You Take if Your Bills Are in Collections?

There are many reasons why you might find yourself in a situation where you can’t pay your medical bills on time. And in some cases, you may have simply forgotten to pay a bill. Once your bill is in collections, there are steps you can take to settle the debt and revive your financial situation.

Make a Plan

The moment you find out a medical bill has gone to collections, you should make a plan on how you are going to pay off the debt. If you didn’t pay a bill because you forgot, be sure to pay in full as soon as possible. 

medical debt collection

If you cannot pay the full amount, creating a plan can help you pay your bill as soon as possible. Medical debt is not something you want to ignore or put off as it will not go away, and your interest will only build. 

Decide how much money you can afford to pay towards your bill each month and begin payments right away, even if they are small. Take a look at your current finances and cut out any extra spending that you don’t need right now.  

Know Your Rights

It is important to know your rights when dealing with collection agencies, as this will help you get the information you need and ensure you receive fair treatment.

You have the right to receive written documentation of any bill that a hospital or clinic sends to collections. This documentation allows you to see exactly what you are being charged for, so you can look for discrepancies or mistakes on your billing. 

You also have the right to review inaccurate information. Make sure you have reviewed your insurance policy thoroughly before attempting this. 

You are entirely responsible for your family’s medical costs. While you may assume that your health insurance plan has covered a procedure, this isn’t always the case. If you don’t receive a bill in the mail, inquire with your doctor or hospital to discuss your financial responsibilities for the procedure. 

Always ask for written documentation of your medical bill with each itemized item. This documentation makes it easier to understand your overall bill and how the hospital charged each item. 

Get Professional Help 

For many of us, a medical bill can be intimidating and confusing. It is difficult to understand all of the charges for procedures and materials, and you question whether the charges are correct. 

Medical advocates can help you navigate your medical bills. They can help you understand each charge and identify possible mistakes or overcharging. If a doctor’s office or hospital overcharges you, or charges you for something that was not a necessity, you may be able to argue the charge and get it removed or lessened. 

You can also look for professionals who will help you with unpaid medical debt. These professional settlers will negotiate with your doctor or hospital to lower your debt. In many instances, doctors and hospitals will settle for a lowering your debt to avoid a patient fighting a charge.

Medical Debt Forgiveness

If you’re unable to work due to a verifiable hardship, such as a disability, this could make you eligible for medical debt forgiveness. If this is something you wish to pursue, maintain proof of your inability to work. This proof could be tax documents or written documents. Sometimes your debt is forgivable in its entirety, depending on your situation. 

Will Medical Debt in Collections Affect Your Credit Score?

A collections debt on your credit report can make your score drop. However, while medical debt will affect your credit score, it has a lower weight than other collections types. 

A collections status on your credit score can negatively affect your score by up to 100 points.

A collections status on your credit score can negatively affect your score by up to 100 points. This can make it more difficult to borrow money and take out loans for homes, businesses, and other financial needs, such as opening a credit card. 

Unlike most debt, medical debt will fall off your credit report once you pay the amount in full. Other types of debt can take up to seven years before being removed from your credit score. You can confirm your score by requesting a free report from one of three credit bureaus; Experian, Equifax, or TransUnion.

You can also obtain reliable information from the Consumer Financial Protection Bureau.

If you have medical debt on your credit score, you should try to pay it off as quickly as possible. Showing that you are paying off your debt can lessen the effect on your score each month. Be sure to pay all of your other bills on time to prevent your score from dropping even more. 

How Can You Bounce Back After a Bill is in Medical Debt Collections?

Once you have a medical bill in collections, you might worry that your finances and credit score will never recover. In 2017, credit reporting bureaus decided that medical debt would no longer linger on consumers’ credit reports after they settle the balance.

This means that once you have the ability to pay off your debt, your credit score can begin to recover immediately. Continue paying all other bills on time and prevent your medical bills from landing in collections in the future. 

What Preventative Steps Can You Take to Avoid Medical Debt Collection?

Having medical bills in collections is a situation you want to avoid altogether. Luckily, there are plenty of things you can do to take care of your outstanding medical debt before it is sent to a collection agency.

Know Your Insurance Coverage

Understanding what your health insurance plan covers and does not cover can allow you to find mistakes and dispute charges confidently. Healthcare offices and medical billing professionals do make mistakes. After all, the billing department involves both people and complicated processes with some margin of error. 

If you are unsure whether an expense falls under your plan, call your health insurance company to have them explain the charge. Many people don’t realize that you can argue and dispute medical charges.

Ask your healthcare provider if the supplies and materials charged during medical procedures were necessary or even used. Compare the costs to other insurance agencies to ensure you are not being overcharged. Many times hospitals and doctors will remove or lessen charges to prevent you from calling again.

Look for discrepancies in your insurance coverage and what was sent to you in the explanation of benefits after a procedure. Ask a professional or seek other online resources if you have trouble understanding your coverage. 

Inquire About Payment Plans

If you know that you cannot pay a medical bill on time, talk with your medical provider or hospital to negotiate a payment plan. It is crucial to do this before your bill is sent to a collections agency, as it will be more difficult once it’s there. 

If your doctor or hospital does agree on a payment plan, get written documentation, and be sure you understand all of the financial obligations. Many times, healthcare practices will add fees or high-interest rates to your payment plan, making it even harder to pay off.

What if You Don’t Have Insurance?

If you do not have health insurance and you have a good relationship with your doctor, you can try discussing options with him or her directly. Some doctors might agree to a discount for a cash payment or be open to a payment plan.

If you do not have medical insurance due to low income, look into your eligibility for Medicaid. Many times hospitals and doctors will have their own financial assistance programs to help those who cannot afford healthcare. Nonprofit hospitals, especially, tend to offer robust patient finance programs.

What if You Do Have Insurance?

If you do have medical insurance, educate yourself on the coverage you will receive before a procedure. Talk with your insurance agency, so you know what charges to expect. If your bill does not reflect this after a procedure, contact your insurance agency and inquire about the fees.

Ask your agency to review each charge and why it was or was not covered. This forces insurance agencies to be honest and catch any mistakes. 

If you do not agree with the way you were charged, most insurance agencies give you 30-60 days to appeal the charge. Keep detailed records of all communications in case you end up needing to make a formal complaint or hire an attorney. 

Putting Your Medical Bill on a Credit Card

If you are out of options and need to prevent your bill from being sent to medical debt collections, the last resort would be putting your medical bill on a credit card. This is something you want to be careful with, as it can create even more problems. 

Credit cards typically have high-interest rates, even if you are able to pay the minimum monthly amount. The rest of your debt will continue to accrue at a high-interest rate. If you are going this route, it is ideal to use a credit card for short term expenses that you know you can pay off quickly. 

If you can’t pay the balance once you’ve put it on a credit card, this can create even more debt and continue to lower your credit score. Have a plan for how you are going to pay off this new debt. 


Having a bill sent to medical debt collections can fill you with dread. There are steps you can take to prevent this and ways to handle it if it happens. An essential takeaway is to always be knowledgeable about your healthcare coverage and make a plan right away. You can recover if you take action.