![]() ![]() Of those issued a writ of garnishment, 38% of the amounts owed were for less than $600. This usually means wages are taken from someone who owes debt and given directly to the collections agency. A writ of garnishment is a court order that allows a third party to take the defendant’s property to pay off their debt. In the cases we looked at, about 40% of the defendants were issued a writ of garnishment. For many, what they ultimately owed ended up being much higher than their initial debt because of added attorney fees, court fees, and interest.Īfter medical debt claims enter the court, consumers’ financial obligations are decided by a judge. Of those 99 cases, almost 64% of the amounts owed were for less than $1,000 – half of those for amounts under $600. ![]() We looked at Denver County court records for 99 medical debt collection cases during the 2015 to 2017 period. ![]() With this information in mind, CCHI did some digging into medical debt collection practices in Colorado. Additionally, the analysis found that 52% of consumers who only had collection debt related to medical claims, had an otherwise clean credit report. The same report also found that most medical collections were for small amounts, with an average unpaid medical collection of about $580. The most recent federal data (2014) found that almost 20% of credit reports had at least one medical collection account listed. In the same year, nearly half of the debts collected were health care related. These credit hits can make it extremely difficult for consumers to take out student loans, purchase a car, or finance a mortgage.Ī report from 2016 shows that of the $729 billion owed in overall debt that year, collection agencies received almost 10%, proving collections to be part of a multibillion-dollar industry. According to a 2016 Commonwealth Fund analysis, 40% of adults age 19 to 64 reported having a lower credit score because of medical debt. This medical collections activity eventually hits consumers’ credit ratings, and depending on state laws, can appear on their credit reports for as long as seven years. Regardless of how the medical bills transpire, or if the consumer is even aware of the charge, if left unpaid, the bills may ultimately be sent to collections agencies. Īll these factors make it difficult for consumers to know what they owe, for what service, to whom, and when it’s due. In this situation, patients can receive an expensive, out-of-network bill, also known as a balance bill. However, when a patient does have comprehensive insurance, and they go to an in-network health care facility, they may still be treated by an out-of-network provider (such as an anesthesiologist, surgeon, or radiologist) without their knowledge. It is easy to understand that without insurance, or with a high deductible plan, an unplanned illness can easily become a huge expense. Medical debt is often a result of urgent or emergency medical services that health insurance will not cover- either because a patient does not have insurance, or because the doctor or hospital was out-of-network. Earlier this year, CCHI did our own research on medical debt collections in order to shed some light on how it might be affecting Coloradans. According to a 9News investigation, eight hospitals in the Denver area have placed liens on people’s houses to collect medical debt. After recent local media coverage and the sheer frequency of medical debt issues, Coloradans may not find this surprising. Medical debt is the number one cause of bankruptcy in the United States. ![]()
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