New Rules Aim to Help Consumers Avoid Huge Medical Bills

August 31, 2012 (Press-News.org) Arizona residents are likely familiar with the Affordable Care Act. One important aspect of the Act that may have been overlooked may now actually help lower income residents avoid huge medical bills and aggressive or harassing debt collection practices.

Proposed Debt Collection Rules

The IRS has proposed new rules under the Act that require tax exempt, non-profit hospitals to provide more consumer protection for lower income patients who qualify for financial assistance. Currently about six out of 10 hospitals in the United States operate as charitable hospitals.

The new proposed rules require hospitals to give lower income patients a four month grace period before handing their bills over to a collection agency. This allows patients a bit of breathing room to seek financial help.

Additionally, the rules also prevent hospitals from using aggressive debt collection techniques against patients who cannot pay their medical bills. This will protect patients against illegal and unfair medical debt collection, a widespread problem in this country.

Specifically, hospitals are prevented from using "extraordinary collection actions" for patients receiving financial help. Hospitals are forbidden from things such as foreclosing on a patient's home, seizing personal property or garnishing wages.

The rules also protect credit scores since hospitals can currently report patients who are not paying their medical bills to credit agencies. This lowers credit scores and makes things like purchasing a home more difficult.

Some feel the rules are in response to a recent scandal involving a Chicago-based debt collection company. The company is accused of using overly aggressive techniques against Minnesota hospital patients while they attempted to get medical care, as well as violating privacy laws.

Seek Assistance With Medical Bills

The last thing a person recovering from an illness or injury needs is a debt collector hounding them when they have trouble paying their medical bills. One option available for those buried under a pile of mounting medical bills is bankruptcy. An experienced bankruptcy attorney can provide guidance through the process and assist with obtaining much needed relief and a fresh start.

Article provided by Arizona Law Group of Trezza & Associates, LLC
Visit us at www.filebankruptcyinarizona.com