How should I pay off over $25,000 in medical collections and repair my horribly damaged credit?

Question

I had surgery back in 2005. I didn't have insurance, so I applied for COBRA. When I asked when the policy would be active, the person taking my information told me she would backdate it to the beginning of THAT day. So, I went to my dr that day and he told me that I needed an ultrasound. The next day, after the ultrasound, I was told I needed to have surgery. A week later, I had the surgery. A month after the surgery, the insurance I got through COBRA sent me a letter telling me that my actual start date on the policy was the day AFTER I called, so they considered my problem to be a pre-existing condition and wouldn't cover the surgery. All the dr's bills went to collections where they have been sitting and ruining my credit. Is there anything I can do 2 yrs after the fact? Is there a way to fight the ins company? What's the best way to pay them off? I need to repair my credit as I am now looking for a house. I just want to get out of this mess I have put myself in.

Answer 1

I went through a similar situation in 2003.  My combined medical bills were $30,000.  I too had no insurance.

I've found some good information here too...

http://debt.123thebest.info/credit_card....

Good Luck.

Answer 2

Two years unpaid?  Your credit isn't going to be good for a while.  Home lenders are very picky right now, w/o 20% AND a good FICO score financing is going to be tough.

My reccomendation is:  Get together some dough (minimum 25% =  $6,250), contatct the creditor and negotiate a settlement.  They will want cash up front, give it to them if they agree in writing to "bullseye"  the negative marks against you.  Don't go for payments, it will reflect on your credit until you pay it off. They will say thay cant, but they can.  Believe me.

There is also BK if you've got other outsanding debt, but it will follow you for 10 years.

Answer 3

The first thing you should do is probably obtain copies of your credit report to see if there is anything else on there ruining your credit. Next, you should consult a financial counselor who can make the best recommendation as to how to go about paying the bills. There should be some kind of consolidation process available to you to aid in making reasonable payments without further ruining your credit. Be prepared though to make some lifestyle adjustments, i.e., missing a few vacations, not purchasing a new car, motorcycle, etc. and look for ways to save money around the house to help pay the bills quicker and make them subside.

Good luck in paying off the bills. Maybe looking at it as paying off a $25,000 car will help you get through it better. Be sure also to obtain affordable health insurance to prevent a situation like this in the future.

Answer 4

First off, I don't think you got COBRA. Cobra is coverage that is continued from a previous employer. There is no pre-existing exclusions and when you elect it, there is no lapse in coverage. You pay the entire premium ack to the date your coverage ended with the employer.

It sounds like you got an individual policy and pre-existing is an "easy out" .

If you had handled this earlier, there might have been more options, but at this point all you can do is make arrangements to pay the collection agency. If you are able to pay a lump sum (a rather large one) they may be able to give you a lesser owed amount.

Answer 5

After 2 years you can't fight the insurance company. Most of them have a 45 day statute of limitations for appeals, and it's never more than a year.  You should have jumped on this the day you got the letter stating your insurance started the day after you thought it would.

The best way to pay them off is any way you can. If you can put down a substantial chunk of money right away, say around $5000 of the $25000, ask if the collection agency will take a settlement, and give you a reduced total. Since you've been in collections for two years, they may not, but it can't hurt to ask. Whatever you do, set up a payment plan - even if it's $50 a month - and stick to it. You won't repair your credit overnight, but it will make a difference.