Why is it that hospitals are quick to take a person to collections?

Question

Even if they are paying as much as they can on their medical bills per month? Don't they know that collections wreck peoples credit? I can see it if someone is not even attepting to pay them back. Sad thing is, many medical procedures are not even affordable even if you have insurance! Isn't that awful? I guess it is better to not go and just drop dead, it would be cheaper!

Answer 1

Hospitals are run by a profit making corporation. The cost of running hospital include giving care for those who cannot afford it.
Health care insurance covers the cost for those who cannot pay for it. That is why your insurance company is charged $2500 a day for a bed. Those who do not have health care insurance are still charged that amount. They do not expect to get paid by the uninsured. Instead they "sell" the amount owed to a 3rd party. The 3rd party pays the hospital an agreed %. The 3rd party then will bill the uninsured the original amount. Whatever they can collect is theirs. Get it. The hospital gets their money without having to have a billing dept. The 3rd party assumes the risk of collecting whatever money they can get.

Is this a good system or bad? Are there abuses? I would say yes. The alternative is a national health care system used by other countries.

I do know one thing. Our local hospital in Morristown, NJ attracts the best heart surgeons with top pay and state of the art facilities.
There are people with heart problems that move to the area just to be assured that if they have a heart attack, they are minutes away from being saved.

Is it fair or equitable? It is what it is.

Answer 2

Hospitals are in the business to make money not for lending money.
When you need medical assistance and don't have insurance or the ability to pay the bill immediately, you should search out your state funded hospital. They don't charge interest and will work with whatever you can pay.
We have only state funded hospitals in our little area here and if we didn't have them we would be all in a mess. Sometimes the state does more for the community than just a few bucks here and there.
Yes, hospitals know they are ruining credit and they don't care, they want their money. If someone has been paying on the account and can prove it and the agreement between the hospital and the person is in writing then that person should have a legal right to get this bill back in the hands of the hospital and out of the collections department.
We always say, if we take a sleeping horse into our hospital they will just tell us he's dead.....so we all agree the medical system needs much more attention.

Answer 3

Health Care is big business. Business' need money to run. It's payment for services rendered. Private hospitals depend on sick people to make money.

Try subscribing to an HMO. Healthy people paying premiums, and then when you get sick or have surgery it's more than affordable. HMO's depend on health people to keep their business afloat...