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Hospital passes medical debt to state with more power to collect

On Behalf of | Mar 19, 2020 | medical debt | 0 comments

Patients in Kentucky who cannot afford their outstanding medical bills often have more problems than merely fielding calls and letters from hospital debt collectors. While they struggle to find enough money to provide for themselves and their families, they might also decline to seek treatment for ongoing or minor health problems. More doctor visits and more medication means more unpaid bills, and drastic collection efforts are pushing some patients to file for bankruptcy.

WFPL.org reports that tens of thousands of University of Kentucky HealthCare patients now find their debt not at the mercy of the hospital, but instead in the hands of the Kentucky Department of Revenue. Unlike most collection agencies, the KDOR does not need a court order to garnish wages or appropriate tax refunds.

Patients claimed that they did not know that they owed money to UK HealthCare or that the state could collect medical debts until they faced one of these situations. The UK Chandler hospital offers charitable assistance to the sick when they have no insurance or other means to pay. However, even when patients make this clear to the medical staff on intake, some are still finding that they have unpaid bills years later after the state takes action, such as intercepting lottery winnings.

Among the reports of failure to properly communicate debts or collection policies are others of mishandling insurance claims. The hospital later refunded a payment for a medical procedure that had been pre-approved by a private health insurer without the patient’s knowledge. The KDOR eventually acquired the account and is attempting to collect a debt that insurance should have covered.

Patients have claimed that the Department of Revenue has made paycheck garnishments that are inconsistent with federal law. They have allegedly threatened to seize personal property to leverage debt, and some victims feel that bankruptcy is the only answer. When patients have more medical debt than they can afford, it may be time to contact a bankruptcy attorney to explore their available options.