What should you do if you suddenly find that your
health insurer hasn't paid claims submitted by your physician? Here's
Mike Kidwell suggests:
1. Read your policy: Every insurer has policies
and procedures you need to be aware of to slash through the red
tape in a timely manner. You may even find that you do, in fact,
owe a bill. Remember, ignorance is no excuse.
2. Make contact: Your best means of resolving
the situation before it hits your credit report is to get in touch
with both your physician and your insurance company. Most importantly,
find out how much time you have before your provider sends the
matter to collections (often it triggers at 90 days). If you are
quick or persuasive, you may be able to prevent this from happening.
In addition, many hospitals have internal collections departments
that will work with you on a payment plan and won't ding your
3. Keep records: In addition to tracking incoming
bills and statements from both your physician and your insurer
(often called Explanation of Benefits), take detailed notes with
time and date of all conversations you have with either party.
4. Pay if you owe: If your doctor sent you
a bill, even if you believe your insurer is ultimately responsible
for the claim, it is better to pay it and collect from your insurer
later than to let it slip into collections. "If you know
you owe it, I would go ahead and pay it and then dispute it,"
says Kidwell. "The fact that you incurred the bill is true."
One bright spot: Physicians tend to be more willing than most
creditors to work out a payment schedule with you.
5. Dispute if you were never billed: If your
provider sent your account to collections without ever billing
you directly, don't pay until they do. "They've got to notify
you that the bill is due," says Kidwell. "Typically,
your insurer would have sent you notification that they had declined
the charge and you should go ahead and pay it." If your credit
report gets dinged, you would have just cause to dispute it based
6. Don't "settle" the bill: If your
account has gone to collections, don't offer less than the full
amount to "settle;" it will be noted as such on your
credit report. "Settling debts can have a negative impact
on your credit," Kidwell says. "That doesn't make other
(future) creditors feel too good."
7. Once dinged, pay up: Unfair as it seems,
the best thing you can do for your credit report once a collection
agency has reported your bill as delinquent is to pay it, then
pursue reimbursement with your insurer. "If it appears on
your credit report as unpaid, that's the more negative entry than
the fact that it did go to collections but it's now paid,"
says Kidwell. "If it's in collections and you know you owe
it, pay it."
-- Posted: Aug. 28, 2002